Asia Morning Gasoil Crack Hits Three-Month High On Bullish Europe
The prompt gasoil crack value in Singapore was assessed at a premium of $67.69/bbl on Monday morning on the back of bullish sentiments in Europe — the highest since April 7 — when compared against the daily closing value on July 17, according to OPIS data and data provided by brokers.
The prompt East-West Exchange of Futures for Swap gasoil value the same morning was slightly higher at a discount of $94.01/mt, compared to Friday’s closing value of a discount of $103.43/mt, but the deep discounts meant that Asian gasoil prices are still lagging behind prices in Europe.
Gasoil inventory levels at the Amsterdam-Rotterdam-Antwerp refining and storage hub fell to 1.68 million metric tons for the week of July 16, compared to 1.80 million mt for the week of July 9, and 1.76 million mt for the week of July 17, 2025, according to data provided by market sources.
Russian exports had fallen sharply in June to 1.84 million mt, the lowest ever according to data from Vortexa, which stretches back to January 2016. This was even before Russia banned gasoil exports starting July, as its refining infrastructure had suffered drone attacks. The loss of Russian barrels means that Europe needs to find backup sources.
Russia was a significant gasoil supplier to Turkey, delivering over a third of gasoil exports in 2025, according to Vortexa data.
Due to the deeply discounted E-W EFS values, Europe is in a better position to compete with Asia for larger long range-size gasoil cargoes from India and the Middle East, but even this is being threatened by a possible closure of the Suez Canal and Red Sea transit route with the escalation in the Middle East conflict.
If the Suez Canal and Red Sea are closed, these parcels will have to travel the longer route around the Cape of Good Hope, and the arbitrages may swing back towards Asia from higher freight costs.
Asia’s gasoil supply situation is in a comparatively longer position than Europe. Although Asia will see less gasoil volumes from India, the Middle East and Russia in the near term, supply from within the Asia Pacific, especially Northeast Asia, is expected to improve.
The release of oil tankers from the Strait of Hormuz in early July, after the signing of the memorandum of understanding between the U.S. and Iran, allowed Asian refiners to operate their facilities at high rates after receiving their crude volumes, a source close to a Northeast Asian oil major said.
Total gasoil exports from Northeast Asia were expected to reach 4.40 million mt in July, the highest since March and the second highest in 2026 to date, data from Vortexa shows.
The final July export volume may end up higher as some Chinese refiners are still offering July loading exports, although some of these cargoes may see their loading delayed to August, a source said.
Exports from Japan and Taiwan, China have more than doubled in July to 396,900 mt and 1.0 million mt, respectively, against export volumes of 129,800 mt and 454,900 mt in June.
While maritime traffic through the Strait of Hormuz has slowed again due to the recent escalation of hostilities, various Asian governments have yet to announce new export restrictions for August and beyond, and various arbitrages may still swing eastward back towards Asia.
—Reporting by Kite Chong, kchong@opisnet.com; Editing by Mei-Hwen Wong, mwong@opisnet.com