Asia's gasoline crack recovered 18 cents to a two-session high of $5.60 a barrel on Friday after diving to its lowest since August 2016 in the previous session as high oil prices and oversupply dragged. The persistent weak gasoline fundamentals had caused Asia's refining margins to dip to a three-month low in the previous session but it managed to climb above $6 a barrel on Friday.
Sellers were given some respite as gasoline inventories eased across continents after climbing to record levels towards the end of March in Europe and Singapore. Gasoline stocks held independently at the Amsterdam-Rotterdam-Antwerp (ARA) refining and storage hub, for instance, fell to their lowest in nearly 2-1/2 months at 1.254 mllion tonnes in the week to April 19, data from Dutch consultancy PJK International showed.
This was in line with lower stock levels seen in Singapore and the United States. "All in all, it should be a weak start to the summer, but as Atlantic Basin pulls out from the glut we should see a recovery," said Sri Paravaikkarasu, of consulting firm FGE. Asia's naphtha crack was at a five-session high of $73.70 a tonne, with at least six buyers having emerged seeking cargoes.
South Korea's GS Caltex was seen paying a $9 a tonne premium to Japan quotes cost and freight (C&F), while KPIC forked out a premium of about $7 to $8 a tonne, traders said. Malaysia-based Titan was also in the market and likely to have paid levels above a mid-single-digit premium to Japan quotes C&F. Japan's Idemitsu and Chinese buyers Unipec and CNOOC were also seeking naphtha.