...APAC Refiners Face Lower Margins from 2H15, Inventory Volatility Fitch Ratings believes the improved APAC refining margins in 1H15 are not likely to be sustainable, as evident from the correction in 3Q industry gross refining margins (GRM). We believe the industry environment will be challenging with volatile crude-oil prices. Demand for oil products has remained relatively strong, supporting gasoline crack spreads. Spreads on diesel crack has been sluggish with excess supplies, including exports from China, which is partly attributable to domestic gasoline demand growth significantly outpacing that of diesel. Fitch-rated APAC refiners posted strong 1H15 results due to improved refining margins and large inventory gains as crude-oil prices picked up in 2Q. Refining margins (before inventory gains/losses) improved significantly in 2H14 and 1H15 after falling during 2013-1H14, and despite ongoing capacity expansion, with robust gasoline demand in US, India and China. Strong refining margins...
