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Asia Distillates-Gasoil cracks weaken, cash differentials flip to premiums

    SINGAPORE, May 14 (Reuters) - Asian refining margins for 10 ppm gasoil slipped on Friday,
despite weaker feedstock crude prices, weighed by expectations for ample supplies amid a
sluggish demand recovery.
    Refining margins, also known as cracks, for 10 ppm gasoil dipped to $8.02 per
barrel over Dubai crude during Asian trading hours, down from $8.32 per barrel on Wednesday.
    The cracks for the benchmark gasoil grade, however, have climbed 5.9% this week in their
seventh consecutive weekly gain.
    The regional gasoil market would likely remain under pressure in the near-term as some
refineries are returning from planned turnarounds, while renewed COVID-19 restrictions in
several markets are dampening the pace of a demand recovery, trade sources said.
    Cash differentials for gasoil with 10 ppm sulphur content GO10-SIN-DIF flipped to a
premium of 10 cents per barrel on Friday, supported by firmer deals in the physical trade
window. They were at a discount of 3 cents per barrel to Singapore quotes on Wednesday.
    
    INVENTORIES
    - Singapore's middle distillate inventories rose 3.6% to a nine-week high of 13.9 million
barrels in the week to May 11, according to Enterprise Singapore data.
    - Weekly Singapore middle distillate inventories have averaged 14.1 million barrels this
year, compared with an average of 13.9 million barrels in 2020, Reuters calculations showed.
This week's stocks were 1.5% lower than a year earlier.
    
    CHINA TO IMPOSE CONSUMPTION TAX ON LCO
    - China said on Friday it will levy a consumption tax on imports of several fuel blending
components, including light cycle oil (LCO), mixed aromatics and diluted bitumen, effective from
June 12.
    - The tax levy is set to deal a blow to regional exporters such as Korean refiners and
global traders which have over the past years supplied China record volumes of these fuels.
    
    JAPAN WIDENS VIRUS STATE OF EMERGENCY
    - Japan will declare a state of emergency in three more prefectures hit hard by the COVID-19
pandemic, Economy Minister Yasutoshi Nishimura said on Friday, in a surprise move reflecting
growing concerns about the virus's spread.
    - Hokkaido, Okayama and Hiroshima will on Sunday join Tokyo, Osaka and four other
prefectures under a state of emergency until May 31, said Nishimura, who is also in charge of
coronavirus countermeasures.
    
    SINGAPORE CASH DEALS
    - Three gasoil deals, no jet fuel trades
    
    OTHER NEWS
    - Singapore announced on Friday the strictest curbs on social gatherings and public
activities since easing a COVID-19 lockdown last year, amid a rise in locally acquired
infections and with new coronavirus clusters forming in recent weeks.
    - Oil prices fell on Friday after dropping about 3% a day earlier as coronavirus cases
remained high in major oil consumer India and as a key fuel pipeline in the United States
resumed operations after being shut due to a cyber attack.
    
    ASSESSMENTS
 MID-DISTILLATES                                                                        
 CASH ($/T)             ASIA CLOSE       Change   % Change   Prev Close  RIC
 Spot Gas Oil 0.5%                70.69    -1.82      -2.51       72.51  GO-SIN
 GO 0.5 Diff                      -1.96     0.04      -2.00          -2  GO-SIN-DIF
 Spot Gas Oil 0.25%               70.84    -1.82      -2.50       72.66  GO25-SIN
 GO 0.25 Diff                     -1.81     0.04      -2.16       -1.85  GO25-SIN-DIF
 Spot Gas Oil 0.05%                  71    -1.81      -2.49       72.81  GO005-SIN
 GO 0.05 Diff                     -1.65     0.04      -2.37       -1.69  GO005-SIN-DIF
 Spot Gas Oil 0.001%              72.75    -1.72      -2.31       74.47  GO10-SIN
 GO 0.001 Diff                      0.1     0.13    -433.33       -0.03  GO10-SIN-DIF
 Spot Jet/Kero                    70.74    -1.95      -2.68       72.69  JET-SIN
 Jet/Kero Diff                     0.05     0.01      25.00        0.04  JET-SIN-DIF
                                                                                        
 For a list of derivatives prices, including margins,                                   
 please double click the RICs below.                                     
 Brent M1                                                                               
 Gasoil M1                                                                              
 Gasoil M1/M2                                                                           
 Gasoil M2                                                                              
 Regrade M1                                                                             
 Regrade M2                                                                             
 Jet M1                                                                                 
 Jet M1/M2                                                                              
 Jet M2                                                                                 
 Gasoil 500ppm-Dubai                                                                    
 Cracks M1                                                               
 Gasoil 500ppm-Dubai                                                                    
 Cracks M2                                                               
 Jet Cracks M1                                                                          
 Jet Cracks M2                                                                          
 East-West M1                                                                           
 East-West M2                                                                           
 LGO M1                                                                                 
 LGO M1/M2                                                                              
 LGO M2                                                                                 
 Crack LGO-Brent M1                                                                     
 Crack LGO-Brent M2                                                                     
 
 (Reporting by Koustav Samanta; Editing by Amy Caren Daniel)
  
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