Singapore light-end, distillate stocks surge to cap Asian refining margins

London, (Quantum Commodity Intelligence) – Combined stocks of light ends and distillates surged by more than 3.5 million barrels in the week to September 16, data from Enterprise Singapore showed Thursday, capping any improvement in cracks for diesel, gasoline and jet.

Inventories of light ends such as gasoline, LPG and naphtha, rose 18%, or 2.1 million barrels on the week, to 14.225 million barrels – the highest in two months and the biggest weekly build since September 2019.

The stocks, however, remain at 2021 averages.

Middle distillates inventories also rose sharply, climbing 1.69 million barrels, or 15%, to 12.958 million barrels, a four-week high and the biggest weekly gain for more than a year as refinery runs outstrip demand.

Distillate stocks, which include products such as jet and diesel, are however 5% below the average so far this year.

Cracks for distillates have eased over the past week, although gasoline cracks have shown a sharp fall off as supply outweighs demand.

The stocks portray a picture of refineries running ahead of demand, despite demand for transport fuels rising in India and Japan.

Fuel oil stocks in the bunkering hub fell a sharp 11%, declining 2.941 million barrels on the week to 23.977 million barrels to mark the biggest weekly draw since December.

Inventories of fuel oil, however, remain at the 2021 average so far.