MOSCOW (MRC) -- Asian refining margins for jet fuel inched higher on Monday, but reimposed travel restrictions in several countries to slow the spread of a highly-infectious coronavirus variant is expected to dent passenger demand recovery, reported Reuters.
Refining margins, also known as cracks, for jet fuel ticked up USD0.05 to USD4.76/bbl over Dubai crude during Asian trading hours.
The cracks, however, have shed 11% since hitting a more than nine-month high of USD5.35/bbl on Dec. 18.
The Philippines on Saturday extended a ban on flights from the United Kingdom by another two weeks to mid-January in a bid to prevent the spread of the new coronavirus variant, while Japan said it would temporarily ban non-resident foreign nationals from entering the country.
Cash differentials for jet fuel were at a discount of USD0.10/bbl to Singapore quotes on Monday, compared with a discount of USD0.11/bbl in the last trading session on Thursday.
The aviation fuel market is getting some support from air cargo demand, which has firmed in recent weeks as e-commerce deliveries surged during the holiday season, market watchers said.
Meanwhile, airlines are also expected to play a vital role in the mass vaccine rollout in coming days, which is expected to unlock an immediate boost for the sector.
As MRC informed before, slumping fuel consumption during the pandemic is accelerating the long-term shift of refining capacity from North America and Europe to Asia, and from older, smaller refineries to modern, higher-capacity mega-refineries. The result is a wave of closures, often centering on refineries that only narrowly survived the previous closure wave in the years after the recession in 2008/09.
We remind that PetroChina has nearly doubled the amount of Russian crude being processed at its refinery in Dalian, the company's biggest, since January 2018, as a new supply agreement had come into effect. The Dalian Petrochemical Corp, located in the northeast port city of Dalian, was expected to process 13 million tonnes, or 260,000 bpd of Russian pipeline crude in 2018, up by about 85 to 90 percent from the previous year's level. Dalian has the capacity to process about 410,000 bpd of crude. The increase follows an agreement worked out between the Russian and Chinese governments under which Russia's top oil producer Rosneft was to supply 30 million tonnes of ESPO Blend crude to PetroChina in 2018, or about 600,000 bpd. That would have represented an increase of 50 percent over 2017 volumes.
Ethylene and propylene are feedstocks for producing PE and polypropylene (PP).
According to MRC's DataScope report, PE imports to Russia decreased in January-November 2020 by 17% year on year and reached 569,900 tonnes. High density polyethylene (HDPE) accounted for the greatest reduction in imports. At the same time, PP imports into Russia increased by 21% year on year to about 202,000 tonnes in the first eleven months of 2020. Propylene homopolymer (homopolymer PP) accounted for the main increase in imports.
MRC