SINGAPORE: Asia’s cash premiums for 10 ppm gasoil dipped on Thursday, hurt by muted cargo demand in the physical trade window, while middle distillate inventories in Singapore climbed to a three-week high.

Cash differentials for gasoil with 10 ppm sulphur content were at a premium of $7.46 a barrel to Singapore quotes, compared with $7.68 per barrel a day earlier.

The regional gasoil market, however, is expected to remain tight in the near term as seasonal refinery turnarounds cap supplies, while recovering jet fuel demand is also expected to weigh on diesel yields, market watchers said.

The front-month regrade, the price spread between jet and gasoil, stood at minus $4.30 a barrel on Thursday, compared with minus $3.55 per barrel a day earlier. The regrade has climbed about 47% in the last two weeks.

The May/June time spread for the benchmark gasoil grade in Singapore, which have narrowed by about 15% in the last week, remained unchanged at $8 a barrel on Thursday. Refining margins or cracks for 10 ppm gasoil slipped to $40.05 a barrel over Dubai crude during Asian trading hours, compared with $42.71 a barrel in the previous session.

Singapore’s middle distillate inventories rose 22.6% to 7.4 million barrels in the week to May 11, according to Enterprise Singapore data. This week’s onshore stocks, however, were about 47% lower compared with the corresponding week a year earlier.