Jet routes reprice: Europe arbs stay open as USWC economics collapse

• Jet pricing has been highly volatile across regions. NWE CIF jet differentials strengthened as jet outperformed gasoil, while Singapore regrade moved sharply lower and Los Angeles sales differentials also weakened significantly. In my last jet brief, dated 10 September, I argued for weaker regrade in both East and West, along with softer LA sales differentials. While Singapore regrade and LA sales differentials moved sharply lower, NWE CIF jet differentials moved against that view.
• The strength in European jet looks more sentiment-driven following the latest Middle East escalation and attacks on Saudi energy infrastructure. European jet fundamentals still look relatively comfortable, with almost every major arb into Rotterdam open for October and November, including Yanbu, WCI, Houston, and even long-haul barrels from Singapore and Korea. This gives Europe significantly more supply optionality in jet than in diesel, where only Yanbu and the USGC offer clearly positive arb routes.
• Diesel remains the tighter barrel heading into winter. The risk of Russia extending its export ban beyond September, rising heating demand, and potential disruption to Saudi refining all pose greater supply risks to diesel than jet. This should limit how far European jet differentials can strengthen relative to gasoil.
• In the East, Singapore regrade has weakened as gasoil carries more of the supply risk premium. Concerns over crude availability following the East-West pipeline disruption, together with uncertainty around future Chinese product exports, have supported gasoil more strongly than jet, which remains comparatively well supplied.
• However, whether China can sustain the recent pace of exports into October remains to be seen, given low domestic product inventories and the risk of teapot run cuts as crude availability tightens. Any reduction in exports would be more supportive for gasoil, but seasonality should also provide some support to Asian jet. Japan is approaching its winter kerosene restocking period, while wide-open EoS-to-Europe arbs provide another outlet for surplus jet. Together, these factors should limit the downside in Singapore regrade despite the currently comfortable supply picture.
• USWC jet has flipped sharply from an open arb to fully shut. November economics are now around -34 cpg ex-Ulsan and -32 cpg ex-Singapore, versus roughly +16 cpg on 10 September, a swing of close to 50 cpg in less than a week. October is similarly closed, with Ulsan around -32 cpg on an MR. In that brief, I expected open Asian arbs to pressure LA sales differentials, and that played out, with October falling to around -50 cpg from -22 cpg on 10 September.
• I am more comfortable being short Nov NWE CIF jet differentials than chasing further downside in Singapore regrade. Europe has broad jet supply optionality, while Russian restrictions, winter heating demand, and Saudi refinery risk leave diesel structurally more exposed. On LA sales differentials, with all major Asian routes into the USWC now shut, that import pressure has effectively disappeared, suggesting LA jet differentials are likely close to a floor and could recover from current levels in both October and November.

(Arbs economics in Rotterdam)

(Arbs in Los Angeles)

(Nov’26 Singapore and European Regrade)

(LA Jet premia Oct 26 and  Nov 26)

About the Author
Abhishek Kumar | Senior Oil Market Analyst, Sparta Commodities
Abhishek is a Senior Oil Market Analyst at Sparta Commodities, based in Dubai, with a background spanning trading and analytics. Before joining Sparta, he held roles at Litasco, LSEG, and Reliance, where he focused on oil market analysis, spec trading, and broader oil market dynamics.
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