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Asia Naphtha Crack Widens; Shell Sells Gasoline: Oil Products

17 Nov 2011

The Asian naphtha crack widened. Royal Dutch Shell Plc sold 97-RON gasoline for the second day in Singapore. PetroChina Co. bought fuel oil in the region’s biggest oil-trading hub.

Light Distillates

Naphtha’s premium to London-traded Brent crude futures, a measure of the profit from the petrochemicals and gasoline feedstock, jumped to $63 a metric ton at 6 p.m. Singapore time from $43.78 at the end of Asian trading yesterday, according to data compiled by Bloomberg. The spread has widened for a second day.

Shell sold 25,000 tons of naphtha for first-half February delivery to BP Plc at $895 a ton, according to a Bloomberg survey of traders who monitored transactions on the Platts window today. Europe’s biggest oil company sold 50,000 barrels of 97-RON gasoline to Glencore International Plc at $115.30 a barrel.

Middle Distillates

Trafigura Beheer BV bought gasoil, or diesel, with 0.5 percent sulfur for a ninth day in Singapore, bringing its purchases this month to at least 20 cargoes totaling 3.2 million barrels, according to the Bloomberg survey. The Amsterdam-based trader paid $2 a barrel over benchmark quotes to Shell to load 150,000 barrels between Dec. 3 and Dec. 7.

Shell bought a similar-sized gasoil cargo with 10 parts-per-million of sulfur from Hin Leong Trading Pte at plus $4.10 a barrel for Dec. 4 to Dec. 8, the survey showed. That’s the highest premium for ultra-low-sulfur diesel since Nov. 8, according to Bloomberg tracking.

Gasoil’s premium to Asian marker Dubai crude fell $1.38 to $19.57 a barrel at 2 p.m. Singapore time, according to data from PVM Oil Associates Ltd., a broker. This crack spread is the narrowest in a week.

Jet fuel’s premium to gasoil rose 30 cents to $1.50 a barrel, the highest so far this week, PVM data showed. A widening regrade indicates it is more profitable to produceaviation fuel over diesel.

BP bought 100,000 barrels of jet fuel from Shell for Dec. 3 to Dec. 7 loading at 10 cents a barrel below quotes, the survey showed.

Fuel Oil

PetroChina purchased two 40,000-ton cargoes of 180-centistoke fuel oil for loading from Dec. 7 to Dec. 11, according to the Bloomberg survey. China’s second-largest oil trader paid $15 a ton over benchmark quotes to Vitol Group and a $14.50 premium to BP.

Fuel oil’s discount to Dubai crude widened 80 cents to $3.93 a barrel at 2 p.m. Singapore time, based on PVM data. That’s the largest gap in four weeks, signaling refiners’ losses from turning oil into residual products are growing.

The premium of 180-centistoke fuel oil to 380-centistoke grade, or the viscosity spread, was unchanged for a third day at $13.50 a ton, PVM said. This means bunker, or marine fuel, moved in tandem with higher-quality fuel oil.