We present high-resolution smoothed particle hydrodynamics simulations of a region of gas flowing in a spiral arm and identify dense gas clouds to investigate their kinematics with respect to a Milky Way model. We find that, on average, the gas in the arms can have a net radial streaming motion of $v_R approx -9 ,mathrm{km/s}$ and rotate $approx 6 ,mathrm{km/s}$ slower than the circular velocity. This translates to average peculiar motions towards the Galaxy centre and opposite to Galactic rotation. These results may be sensitive to the assumed spiral arm perturbation, which is $approx 3%$ of the disc potential in our model. We compare the actual distance and the kinematic estimate and we find that streaming motions introduce systematic offsets of $approx 1$ kpc. We find that the distance error can be as large as $pm 2$ kpc and the recovered cloud positions have distributions that can extend significantly into the inter-arm regions. We conclude that this poses a difficulty in tracing spiral arm structure in molecular cloud surveys.
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