Asia's gas oil premium against Dubai crude weakened on Friday, dampened by rising supply from South Korean and Taiwanese refiners at a time of softer demand. In the Singapore market, Hin Leong bought 150,000 barrels of 0.5 percent gas oil from SPC at $180.48 a barrel for loading on July 19-23. The trade was equivalent to around $1.86 a barrel premium, close to the premium of $1.60 fetched in a previous deal.
Higher stockpiles in Northwest Europe and rising freight rates hampered Asian diesel flows to the West. Gas oil stocks in Amsterdam-Rotterdam-Antwerp (ARA) hub rose to 1.482 million tonnes in the week ended July 3 from 1.346 million tonnes as of June 26. The inventories were at their highest levels this year.More supply emerged from Northeast Asia, dampening the market further.
Taiwan's Formosa offered 240,000 barrels of 500 ppm gas oil for loading in early August, having sold 480,000 barrels of 50 ppm gas oil earlier. On the other hand, jet-kerosene was healthy thanks to arbitrage shipments to Northwest Europe and steady demand within Asia.