Monday, February 10, 2020

Coronavirus impact on jet fuel exports limited; India may get diverted crude: Nayara CEO

Singapore — India's Nayara Energy has not seen any major disruption to its jet fuel exports despite global air travel disruptions as bulk of its overseas sales are under term contracts, but there could be an impact on volumes if the spread of coronavirus is not contained soon, its CEO B Anand told S&P Global Platts in an interview.

Register Now An expected slowdown in China's crude oil appetite due to refining run cuts also may prompt Middle Eastern and other key global crude suppliers to look for other markets in the near term, and India would be a logical alternative, he added.
"Nayara mainly has long-term commitments for jet fuel. Structurally, we do not see major disruption to our jet fuel exports. But there could be an impact if this continues and spreads further," Anand said, adding:

"We are seeing weaker cracks and it's a situation that we are closely watching."

Traders expect more downside pressure on jet fuel refining margins in Asia as airlines suspend multiple flight routes in the wake of the coronavirus outbreak.

Both physical and paper jet fuel cracks against Platts Dubai crude benchmark tumbled below the psychological support level of $10/b last week as aviation fuel demand continues to slide in line with the growing number of flight cancellations and suspensions.

The FOB Singapore jet fuel/kerosene crack against front-month cash Dubai crude was the weakest in four-and-half-years at $8.23/b on Friday. The last time the crack spread was any lower was on August 6, 2015, when it stood at $7.83/b, Platts data showed.
10/02/20 S&P Global
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