* Vitol seen storing gasoline off Singapore
* Oversupply despite refinery maintenance/outages
* Singapore onshore light distillates stocks at record levels
By Seng Li Peng
SINGAPORE, March 28 (Reuters) - European trader Vitol is storing gasoline on tankers offshore Singapore, Asia's biggest oil trading centre, for the first time since 2016 amid oversupply and weak demand for the fuel, said four people that participate in the market on Wednesday.
The sources said that Vitol was seen storing gasoline aboard more than one so-called Long-Range (LR) tanker. The company does not typically comment on its trading operations.
At least one of the vessels is the tanker Glory Crescent, a so-called LR-2 tanker, said one of the four sources.
The vessel is 105,000 deadweight tonnes and could carry the equivalent of about 800,000 barrels of gasoline.
According to data on Thomson Reuters Eikon, the Glory Crescent was fixed on Feb. 27 by a charterer that was not revealed for a one- to two-month time charter for storage.
The Aframax LR-2 vessel is currently at anchor offshore the city-state, the data show.
Since the start of 2018, gasoline market has been in a contango structure, where front-month prices are lower than later-dated prices which is indicative of a weak market. This month, the contango between March and April prices widened to as much as 50 cents a barrel.
Typically, traders can store fuel in a contango market in expectation of the later rising prices, but the current contango does not justify, according to the sources.
"The contango is not wide enough to encourage storing gasoline but Vitol may have its own economics for doing so," said one of the sources.
In 2016, traders including Vitol, Unipec, Total and Gunvor were storing gasoline aboard vessels off Singapore as the contango deepened to $1 a barrel.
So far, Vitol is the only company storing fuel, the sources said.
They were not expecting more to follow suit, although the market remained saddled with supplies despite recent refinery outages in Taiwan and ongoing refinery maintenance in North Asia.
The latest data from Singapore's International Enterprise (IE) showed that onshore light distillates stocks held in the week to Tuesday were at a record of 15.635 million barrels.
Over in Europe Gunvor, Litasco, Trafigura, Socar as well as Vitol had already used vessels to store gasoline this month following slow demand for petrol from the United States.
"Refinery runs in the Atlantic Basin are at elevated levels, despite turnaround activities ... This had a cascading effect on Singapore cracks as the U.S. still sets the tone for regional gasoline cracks," said Sri Paravaikkarasu of FGE.
Overall, gasoline demand in Asia this year is expected to lag 2017, she added.
The gasoline crack refers to the profit from refining a barrel of oil into petrol. GL92-SIN-CRK
Additional reporting by Jessica Jaganathan; Editing by Christian Schmollinger