[SINGAPORE] Oil product inventories surged to their highest since at
least 1999, signs that markets are struggling with a supply glut that
could prompt refineries in the region to cut rates, traders and analysts
said on Thursday.
For the first time since August 2014, stocks of oil products climbed
all at once for the second straight week, pointing towards a growing
supply glut that could pressure refiners globally to cut rates. "Diesel
stocks are rising fast, especially in the East of Suez," Energy Aspects
analysts said in a note on Thursday. "Run cuts to the tune of 0.7
million barrels-per-day globally will be needed to balance Q4 2015's
diesel (supply) worldwide, especially given the rate at which onland
stocks are rising," it added.
Singapore's middle distillates stocks, which comprise gasoil and jet
fuel, rose nearly 6 per cent to a nearly four-year high of 13.172
million barrels in the week to July 22, IE data showed.
With Asian gasoil margins at a more than five-year low on the back of
seasonally weak demand and mounting supplies, traders said they are
storing the product in landed tanks.
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