SINGAPORE: Asian jet fuel refining margins climbed on Tuesday, partly supported by a gradual recovery in international airline capacity, but demand weakness in China’s key domestic aviation market is expected to cap gains in the near term.

Refining margins, also known as cracks, for jet fuel rose to $28.56 per barrel over Dubai crude during Asian trading hours, up from $27.71 per barrel a day earlier.

Global international airline capacity rose 3.3%, or over 1 million seats, to 32.6 million seats in the week to Monday, still 30% lower compared with the corresponding week in pre-pandemic 2019, according to aviation data firm OAG.

“North East Asia saw domestic capacity fall by 2.8 million seats this week, or 18.5%, a large enough movement to make a significant effect on global trends. Elsewhere, most regions continue to grow,” OAG said in a statement.

Cash premiums for jet fuel rose to $3.35 a barrel to Singapore quotes, compared with $2.28 per barrel a day earlier.

The front-month time spread for the aviation fuel in Singapore, which have remained in backwardation since late-November, traded at $2.95 a barrel on Tuesday, as against $2.25 per barrel on Monday.