UPDATE - Singapore refiners lift crude runs to 80 pct
Tuesday March 18, 4:16 am ET
SINGAPORE, March 18 (Reuters) - Singapore's four refineries, tempted by strong refining margins, have increased crude processing rates by five to 15 percentage points, industry sources said on Tuesday.
They said refiners were running plants at close to 80 percent of nameplate capacity, up from last year's average level of 65-75 percent.
"Refineries have modestly increased their runs due to attractive margins," said one industry source.
Singapore's four refineries have a combined crude processing capacity of 1.3 million barrels per day, with middle distillates accounting for 50 to 60 percent of products output.
According to Merrill Lynch, complex crude refining margins in the benchmark Singapore market rose in the week to March 7 to $7.48 a barrel.
The complex margin refers to the profit for processing feedstock into higher-value products such as jet-kerosene, diesel and gasoline.
According to Merrill Lynch, complex margins in early March were just 16 cents off a seven-year high at $7.64 struck in mid-February.
The International Energy Agency (IEA) said in its Monthly Oil Market Report for January that net crude imports into Singapore rose to 922,000 bpd, up 110,000 bpd from December "as refinery runs remained strong in January with supportive margins".
Industry sources said the margins could stay near current levels for the next month or so.
Uncertainties over the impact on oil supplies of a possible war in Iraq and current high shipping rates may keep arbitrage supplies out of the region and prices in Asia firm, they said.
Traders attributed healthy profits to strong prices for light distillates -- naphtha and gasoline -- and middle distillates -- gas oil and jet fuel -- versus Middle East benchmark Dubai crude.
"Margins are very healthy. The levels are much better compared to those last year," said one dealer.
Many tankers moving crude to Asia have been diverted to ship crude and products to the United States, where fuel stocks have fallen to very low levels.
Singapore, Asia's oil trading hub, exports almost all of its oil products and acts like a swing supplier to the Asian market, which consumes about 21 million barrels per day.
The four refineries in Singapore belong to ExxonMobil (NYSE:XOM - News), Shell Eastern Petroleum (London:SHEL.L - News; Amsterdam:RD.AS - News) and Singapore Refining Co. |
