India diesel exports to Singapore set for highs in Aug, drop for Europe -trade
India’s diesel exports to Singapore are set to hit a 19-month high in August and exceed 330,000 metric tons, boosted by cheaper freight costs and low inventories in the Asian oil hub, traders and analysts said.
The country’s exports of the fuel for August to Europe, on the other hand, are poised to fall to their lowest this year, according to one shiptracker, as shipments to the east are more profitable, but that situation may not last.
The rise in Indian diesel exports to Singapore will compensate partially for lower exports from refiners in northeast Asia including China, and the increased availability will therefore cap strong refining margins in Asia. Conversely, European refiners’ margins will be supported by the lower imports from the South Asian nation.
Meanwhile, India’s diesel exports to Europe in August could fall to around 320,000 tons, the lowest this year, Kpler data showed.
Diesel imports into Europe in September are expected to fall because demand east of Suez has been stronger and more cargoes will likely remain in the region instead of heading West, one Europe-based trader said.
However, the jump in India’s exports to Singapore could be short-lived as the east-west arbitrage price spread is widening, which could make exports to Europe more profitable again, said FGE analyst Liu Xuanting.