Asian gasoline cash differentials sink on Asian Covid wave

London, (Quantum Commodity Intelligence) - Spot gasoline crack margins on a FOB Singapore basis fell for the sixth successive session in trade on Wednesday as fears over demand destruction in Asia hit cash differentials.

Two spot trades at a flat price of $75.40/b were heard in the market, on a day when gasoline swaps moved higher than the the forward value of crude oil.

With paper cracks improving for June to $5.51/b from $5.24/b a day earlier, spot cracks fell to $4.52/b - a near three-week low.

Spot gasoline cracks have been on a downturn over recent sessions after Malaysia announced a two-week national lockdown to battle a growing epidemic there, the Australian state of Victoria announced new movement curbs and Vietnam found a new strain of the virus.

At the same time, demand from India and Japan for gasoline remains subdued on local movement restrictions.

Those curbs have hit gasoline differentials, which just a week earlier were trading in positive territory, but are now valued at -$0.70/b under the swaps curve - a dynamic that shows a sharply weaker market for cargoes loading in the next 15-30 days.

The move south in spot cracks comes despite a relatively firm RBOB crack in the US, which remains at $23.50/b, largely flat for the last four weeks ahead of the US summer driving season.