The Singapore 500 ppm sulfur gasoil cargo differential climbed to a new 10-month high of plus 38 cents/barrel at the Asian close on Wednesday, supported largely by buying interest in the grade during the Platts Market on Close assessment process, S&P Global Platts data showed.
The 500 ppm gasoil cash differential was last higher on June 9, 2016 at plus 43 cents/b. The spread was assessed at the start of this week at plus 27 cents/b and stood at minus 25 cents/b at the start of this year.
Cash differentials for physical gasoil represent the price buyers are willing to pay for the product, below or above the benchmark prices published around the day a cargo loads.
According to market sources, the gasoil market is fundamentally short as many refineries in the region are undergoing maintenance.
"It is peak [refinery] turnaround season [and] that is coinciding with peak demand in a lot of countries prior to [the] monsoon," a Singapore-based trader said.
Regional trader Winson has been the biggest buyer of 500 ppm sulfur gasoil during the Platts Market on Close assessment process, so far in April. The trader has bought a total of 5.55 million barrels of the grade in March and April.
