Asia-Pacific middle distillate markets are weakening, amid high regional refinery runs. Regional gasoil margins are still stronger than a year ago, when the global economy was moving out of recession, but they are beginning to slip. The gasoil crack spread has fallen to below $12/bl, after rising to nearly $14/bl in late June (see graph). More middle distillates are moving into the regional market, as refiners increase output and some long-haul outlets for the surplus remain closed. And stocks are rising. Singapore gasoil inventories rose to 15.6mn bl in early July, their highest this year.
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