February-loaded diesel cargoes heading towards product storage sites in Singapore and Malaysia have risen sharply from previous months, Vortexa data show, coming against a backdrop of weaker Asian middle distillate cracks post-coronavirus outbreak.
Surplus cargoes heads to Singapore and Malaysia storage
Singapore-bound diesel loaded from China and South Korea in February surged to 230,000 b/d, up by nearly 50% month-on-month. Around half of the flows to Singapore in February have already been discharged into storage terminals as of 6 March, while some of the remaining in-transit cargoes could be heading to neighbouring import markets.
A further 170,000 b/d of diesel cargoes from these two sources were exported to Malaysia’s storage terminals in Pengerang, Tanjong Langsat and Tanjong Pelepas (ATB Oil Terminal), up from 110,000 b/d observed in January.
Singapore distillate stocks up
Rising distillate arrivals into Singapore have pushed up its onshore inventory to 11.9mn bls in the first week of March, versus 10.7mn bbls in the first week of February, as reported by Enterprise Singapore.
Another 2.4mn bbls of diesel was observed stored on floating vessels in the Tanjung Pelepas lightering area on 2 March, up by around 40pc from last week, according to Vortexa’s data.
China middle distillates exports up year-on-year
Meanwhile nearly 500,000 b/d of diesel was exported from China in February, up 5% year-on-year, while China's jet/kerosene exports totalled 260,000 b/d in the same month, a 40% increase from previous year. Both however were slightly lower than January exports.
Strong distillate exports in February have been preceded by the firm levels in January and last December, adding to the distillate length in the regional market.
South Korea diesel exports rise; Indian exports down
South Korea’s diesel exports jumped by 30% month-on-month in February to around 590,000 b/d, further exacerbating the regions’ supply overhang.
Elsewhere in Asia, a contraction in India’s diesel exports on the back of refinery maintenance offered limited support.
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