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Profit margins from gasoline refining in Asia jumped to one-year highs after Indian refiner Reliance Industries declared on Wednesday force majeure on exports of its predominantly export-oriented Jamnagar refinery earlier this week.
The Jamnagar refinery has a capacity for processing 580,000 bpd of crude oil, and is part of the world’s largest refining hub, according to Reliance Industries.
In a stock exchange filing, Reliance said on Wednesday that it had shut down one of the fluid catalytic cracking (FCC) units at the Jamnagar refinery, without specifying the reason for the shutdown. The unit will restart in two weeks, the company said, noting that the rest of the refinery won’t be affected and will operate normally.
Trade sources told S&P Global Platts that the capacity of the affected FCC unit was around 215,000 bpd. Between three and five gasoline shipments would be affected by the force majeure, the sources said.
According to Reuters sources, at least two cargoes of gasoline scheduled for loading in August from Reliance were affected.
One source told Platts that the Jamnagar plant had problems for some time, and the company tried to “do what they could” before declaring force majeure. The unit had issues for a week before Reliance declared force majeure, according to other trade sources.
According to Platts data, the benchmark Asian gasoline crack to October Brent futures jumped to its highest since September 19 last year. The force majeure at the large Indian export-oriented refinery comes at a time when several refineries in Asia are out due to turnarounds or outages, and when demand in Indonesia is very strong. The single biggest gasoline importer in Asia, Indonesia’s state-held energy firm Pertamina, plans to import its highest level of gasoline so far this year in September, according to Platts data.
Elsewhere in Asia outages, the 200,000-bpd Nghi Son refinery in Vietnam has been shut since Sunday evening local time, after an electric generator fault led to the shutdown of the power supply system.
By Tsvetana Paraskova for Oilprice.com
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Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews.