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New Asian Oil Product Flows Drive Up Derivatives Trading

Asia's growing oil product flows, tied to massive new refinery investments, are driving a big rise in derivatives trading in the region with volumes for diesel, jet fuel and gasoline are all set to rise sharply this year.

Indonesia, one of Asia's top oil importers, is also planning huge expansions of refining and storage.

"More product trading is becoming more long-haul and this can be seen via National Oil Companies (NOCs) trying to build up downstream operations to produce clean refined products," said Mike Davis, director of ICE Futures Europe's market development, referring to products such as diesel and gasoline.

Singapore gasoline showed the most growth, reaching 5.675 million barrels over January to November this year in Platts' window of trading hours, up from 600,000 for the whole of 2012, and from 2.675 million barrels in 2013, a Platts spokesman said.

Singapore diesel and jet fuel volumes have risen to 251.6 million barrels over January to November this year, up about 40 percent from 2013, and up nearly 70 percent from 2013, he added.

Saudi Aramco, for instance, traded its first diesel and fuel oil derivatives in pricing agency Platts' monitored trading hours in September and October.

( Reuters Edited by Topco)