Asian spot prices fall with fuel oil posting sharp drops.

摘要

Spot product prices fell across the board in the week to July 3. Light and middle distillates posted moderate declines, and fuel oil prices fell sharply but differentials for the heavy fuel found support on lower inventories. Gasoil differentials came under pressure as prompt supplies were plentiful and demand from India and the Middle East was expected to wane through the 3Q. Spot supplies from the Middle East have resumed earlier than expected, traders said. The diesel market is entering the weak shoulder season following the peak run-up to summer and Ramadan demand and prior to stockbuilding for winter, leaving supplies to rise amid subdued buying interest. "A lot of diesel will be trapped in the Far East and this will lead to run cuts in places like Japan and Souda Korea as the arbitrage to the West will be closed by growing Middle Eastern supplies," said an analyst with Energy Aspects. Petrolimex, Vietnam's top importer, ended its diesel term contract ties with Kuwait Petroleum Corp. that had dated back to the 1990s, industry sources noted. Due to the government's recent changes in import duties and a move toward cleaner fuels, Petrolimex, and presumably other Vietnamese importers, will purchase fuels from Southeast Asia, under a trade deal covering the Association of Southeast Asian Nations (ASEAN). "Vietnam won't be able to lift cargoes from Kuwait due to the tax issue as the difference between ASEAN and non-ASEAN is 5%," the sources added. Meanwhile, jet fuel prices eased. The market was quiet, stocks were amble, and demand was tepid.