Arrivals of jet fuel into Hong Kong, a key regional importer of the product, fell to a multi-year low of 400,000 mt in February, Vortexa data show, amid the broad disruption in airport transport following the coronavirus outbreak.
Jet fuel imports into Hong Kong’s PAFF terminal — the largest seaborne jet fuel importing terminal in the world — also fell to a multi-year low in February.
More jet fuel arrived into other Hong Kong terminals in February, however, compared with prior months. MR tankers Phoenix Hill and Chang Hang Guang Rong discharged around 100,000 mt jet fuel into Sinopec, Chevron and ExxonMobil-owned terminals. Collectively they represented a quarter of total jet fuel flows into Hong Kong in February, compared to the mere 3% share they represented in the prior twelve months.
Preliminary indications of jet fuel arrivals into Hong Kong this month so far suggest March could be as weak as, if not weaker, than February. Two MR-sized tankers are expected to discharge their jet fuel cargoes into Hong Kong in the first week of March - one from Taiwan, and another one from China's Dalian. This compares with five MR-sized arrivals in the first week of February.
Weakness in the jet “regrade” in Singapore — the premium jet holds over diesel — may be incentivising the blending of jet into the diesel pool, according to market participants. Singapore jet regrade values fell to their lowest in more than a year at the start of February, and despite a slight recovery, remain well below levels seen in January.
In line with this, Asian jet fuel exports outside of the region did not rise in February compared with previous months - while diesel exports did, underlining the global impact of weaker jet fuel demand.
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