text: Mideast Gulf oil outlook - India holds the key . DUBAI 1996-08-29 India will continue to hold the key to the middle distillates product market in the Middle East Gulf in the short term , traders in the region said on Thursday . They said premiums on high quality jet kerosene have widened to around $ 1 , and are likely to remain strong in the near term . " On the jet kerosene side we must be cautious about quality . Some are commanding a very good premium of 95 cents to one dollar . It 's been 99 cents to Korea . This will stay at this sort of price premium for a while , " one said . " But for normal jet the weakened demand is quite noticeable , the premium is around 45-50 cents . The differential is not normally as wide as this , " he added . Another put the premium for jet kerosene at between 65 and 75 cents . One trader said despite the fact that some kerosene was in storage at Dubai ports , demand looked to exceed supply in the near term . Jet kerosene was assessed at $ 27.40 - $ 27.70 a barrel fob Gulf on Thursday , up from $ 27.22 last week . Dealers expected premiums to stick around current levels for the next two or three weeks , before they get a boost in the second half of September from demand for October cargoes . Gas oil , assessed at $ 24.00 - $ 24.20 a barrel fob Gulf , was little changed on Thursday from last week 's $ 24.10 - $ 24.24 . " On gas oil , in the near term demand and supply are balanced to a bit short , there are some enquiries into east Africa and short covering in India , " said one trader . " The Indians have awarded three cargoes , but the question is whether they will come out for more , " he added . India has acquired 120,000 tonnes of diesel in three cargoes , bound for the west coast , in its October tender . Traders said the award could be India 's lowest in recent years . " After IOC 's very small purchase of 120,000 tonnes , I 'm still suspicious that they will buy more in the second half of October , " another said . But traders see the market remaining tight in the short-term , with some surplus arising closer to October . " I see an overhang of gas oil further out , " one said . " Gas oil will remain tight in the short term up to mid-September with the premium of around $ 1 for 0.5 percent ( sulphur material ) . In the second half of September and October we see the premium coming off to 70-75 cents . " Traders said there was not much demand for one percent sulphur material gas oil , with the premium at 40 to 45 cents .