Commercial onshore light distillate stocks in Singapore, the region's largest oil trading hub, ballooned to a 13-month high in the week ended Wednesday, as regional demand for gasoline ground to a halt amid the global effort to combat COVID-19.

Stocks of light distillates in the week ended April 15 jumped 14.2% on the week to total 16.476 million barrels, data released late Thursday by Enterprise Singapore showed.

Stocks were last higher in the week ended March 17, 2019, at 16.708 million barrels.

The surge in stocks was attributed to a significant fall in demand in the city-state, which mirrored decreased appetite for motor fuels across the region, source said.

The former was a result of latest actions taken by the Singapore government that has placed the population under “Circuit Breaker Measures” from April 7 to May 4, closing schools and most workplaces, according to media reports.

“No one is driving. The roads are practically empty. Your tanks just continue filling up,” one Singapore-based source said.

In addition to Singapore, two large regional buyers of gasoline -- Malaysia and Indonesia -- have also curtailed driving through stricter travel measures. Malaysia’s movement control order has been extended to April 28, from the originally scheduled April 15, while Indonesia has imposed partial lockdown measures in its capital of Jakarta since April 10.

Asia gasoline exports

Against the backdrop of falling demand, traders have been scrambling to move cargoes overseas.

Over the period of April 9-15, 40.43% of total Singapore exports of gasoline of grades between 90 RON and 97 RON were exported out of Asia, Enterprise Singapore data also showed.

However, traders are doubtful whether such flows could continue moving forward, given that global demand has curtailed.

“The arbitrage flows were booked earlier when the economics were workable. Now, even overseas outlets are not buying as much,” said one source.

Mexico, which over the period of April 9-15 took in 23,375 mt of gasoline from Singapore, had recently seen domestic demand sink to its lowest level in the year at 701,000 b/d in the week ended March 27, S&P Global Platts reported earlier.

Reflecting the poor fundamentals, the FOB Singapore 92 RON gasoline crack against front-month ICE Brent crude futures has remained firmly in the red, being assessed at minus $7.23/b at the close of Asian trade Thursday, albeit higher than the minus $12.64/b assessed a week earlier.

Naphtha up on bargain hunting

Meanwhile, the Asian naphtha market rebounded after a flurry of bargain hunting from end-users helped clear cargoes, while ship delays pushed back some US-origin cargoes to the H1 June delivery cycle.

The Asian naphtha complex has been weighed down by an overhang of Western arbitrage cargoes, which drove the physical naphtha crack and cash differentials to multiyear lows

But with the increased buying this week, CFR Japan naphtha physical cracks against front-month ICE Brent crude futures rebounded 39.98% day on day at minus $15.20/mt on Thursday's Asian close.

The cash differential for spot paraffinic naphtha parcels was also assessed at minus $10.50/mt at Thursday's Asian close, up $1/mt day on day, against the benchmark Mean of Platts Japan naphtha physical, on a CFR Japan basis.

Exports of naphtha, reformate and other blendstocks were thin over the April 9-15 period, dropping 3.25% on the week at 7,607 mt, Enterprise Singapore data showed.