Asia distillates-jet fuel cracks inch up; renewed travel bans likely to hurt recovery
SINGAPORE, Dec 28 (Reuters)—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.
Refining margins, also known as cracks, for jet fuel ticked up $0.05 to $4.76/bbl over Dubai crude during Asian trading hours.
The cracks, however, have shed 11% since hitting a more than nine-month high of $5.35/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 <JET-SIN-DIF> were at a discount of $0.10/bbl to Singapore quotes on Monday, compared with a discount of $0.11/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.
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