Wednesday, 28 December 2011 at 10:11, Bloomberg
Fuel oil’s discount to Dubai crude narrowed 24 cents, or 6.7 per cent, to $3.40 a barrel. (REUTERS)
Asia refining losses from fuel oil narrowed from the widest in more than a week on optimism that demand will rise next year. Profits from gasoil fell to the lowest in more than two months.
Fuel oil’s discount to Dubai crude, a measure of refining losses from the fuel, narrowed 24 cents, or 6.7 per cent, to $3.40 a barrel at 10:31 am Singapore time, according to data from PVM Oil Associates Ltd. On Tuesday, the discount reached $3.65, the widest since December 16.
The spread has narrowed 69 per cent so far this year, data from the London-based broker showed.
High-sulfur fuel-oil swaps rose $7.75, or 1.2 per cent, to $666.75 a metric tonne. The premium of 180-centistoke fuel oil to the 380-centistoke grade was unchanged at $11.25 a tonne.
Fuel oil in Asia may trade at a three-year high relative to Dubai crude in 2012 as surging demand from shipping companies and reduced refinery supplies counter slowing consumption by Chinese power stations and factories, according to a Bloomberg survey of five analysts and traders.
Gasoil’s premium to Dubai crude fell 35 cents, or 2.1 per cent, to $16.62 a barrel, the lowest level since October. 19, PVM data showed.
January swaps for gasoil rose 60 cents, or 0.5 per cent, to $122.60 a barrel. The fuel traded at parity to jet fuel, PVM data showed.
January swaps for naphtha, a feedstock for petrochemicals and gasoline, rose $8, or 0.9 per cent, to $919 a tonne, PVM data showed.
The swap value was at a premium of $94.93 a tonne to Brent futures, little changed from $95.52 at the end of Asian trading on Tuesday.
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