South China gasoline blending margins shrink 9.6% on higher costs

Source: ICIS News

2019/01/11

SINGAPORE (ICIS)--Theoretical gasoline blending margins in south China on 10 January fell by yuan (CNY) 88/tonne or 9.6% from the week-ago level, as blendstock costs rose at a faster pace than blended gasoline price amid firmer crude.

State-owned major refiners and Shandong independent refiners raised their selling prices of gasoline.

Meanwhile, brisk replenishing activities and the expectation of no further drop in fuel retail ceiling prices also supported gasoline prices.

Blendstock prices went up across the board.

Solid demand from refiners and firmer gasoline bolstered blenders’ purchases for methyl tert-butyl ether (MTBE) and alkylated oil.

The rises in crude led prices of mixed aromatics and naphtha to move upward.

C5 prices strengthened on improved blending demand despite weaker demand from the chemical sector.

Looking into the coming week, blending margins are likely to widen as blendstock costs may rise fewer than gasoline prices.

Stocking requirements ahead of the Lunar New Year holiday (4-10 February) and the spring rush may boost gasoline consumption and in turn gasoline prices.

BLENDING MARGINS OF 92-RON GASOLINE(CNY/TONNE)

Naphtha Mixed aromatics Alkylated oil MTBE Off-spec gasoline C5 Blending costs Blended 92-Ron gasoline Blending margins Blending ratio 15% 35% 20% 10% 15% 5% - South China 5,875 5,525 5,625 5,850 6,490 4,300 5,894 6,725 831

ICN