<article><p class="lead">Asia-Pacific gasoline refining margins have risen to the highest level for almost two months, supported by an increase in driving activity as some countries in the region ease travel restrictions.</p><p>The Singapore 92R gasoline price strengthened to a 19¢/bl discount to Ice Brent crude yesterday, closing in on positive territory for the first time since 13 March, according to <i>Argus</i> data. </p><p>Demand for gasoline is likely to rebound more quickly than for jet fuel, even as some countries start to reduce restrictions on air travel imposed because of the Covid-19 pandemic. The different pace of the demand recoveries, coupled with a shortage of oil product storage space, is likely to weigh on refinery run rates and provide some support for gasoline and gasoil margins.</p><p>China lifted all remaining transportation curbs in Wuhan in early April, boosting fuel demand and economic growth in the city where the coronavirus first emerged. Rising domestic consumption means gasoline exports from China are on course to fall to 190,000 b/d in May, down by more than 50pc from an average of 420,000 b/d in January-March, according to market estimates.</p><p>Driving in Vietnam, Australia and New Zealand — all countries that have had some success in containing the coronavirus outbreak — rose in the first week of May, according to mobility data from Apple that gives an indication of driving activity by tracking direction requests.</p><p>Australia on 8 May published a three-step plan outlining some easing of travel restrictions. Some retail businesses, cafes and restaurants will be allowed to reopen and groups of up to 10 people can meet. Vietnam on 7 May allowed non-essential businesses to restart after the country went three weeks without any new community spread of the virus. And New Zealand will reopen retail operations, malls, restaurants, cinemas and other public spaces on 14 May.</p><p>Gasoline demand may also get a boost from the US peak summer driving season, as coronavirus restrictions start to ease in some states. An increase in US driving activity has lifted Nymex RBOB prices and supported gasoline market sentiment in Asia-Pacific. Driving activity in the US has increased to 30pc below a 13 January baseline, compared to 60pc below the baseline at the start of April, according to the Apple data</p><p>But ample gasoline inventories in onshore tanks and floating storage around Asia-Pacific will put downward pressure on any market recovery, while driving activity remains low in some major gasoline buyers such as Indonesia, market participants said.</p><p class="bylines">By Aldric Chew</p></article>
