Asia’s spot fuel oil market steady

SINGAPORE: Asia’s spot fuel oil market was little changed on Thursday, while more tenders for April were in progress, trade sources said.

Kuwait’s KPC sought 80,000 tonnes of high sulphur fuel oil (HSFO) for delivery between April 10 and 11, while Taiwan’s CPC offered 22,000 tonnes of catalytic fractionator bottoms (CFB) for loading in April. Both tenders close on Thursday.

Singapore’s 0.5% very low sulphur fuel oil (VLSFO) cash differential inched lower to $6.09 a tonne on Thursday, as market backwardation softened from the previous day.

The 0.5% VLSFO front-month crack rose slightly from the previous session to $8.65 a barrel at the Asia close (0830 GMT).

Meanwhile, the market structure for 380-cst HSFO firmed, while Singapore’s spot 380-cst HSFO premium was flat at $8 a tonne. The front-month 380-cst HSFO crack inched slightly higher to a discount of $12.53 a barrel at the Asia close.

Onshore fuel oil stocks fell 2% at 22.58 million barrels (3.56 million tonnes) in the week ended March 29, latest Enterprise Singapore data showed. The decline came amid a drop in net fuel oil imports, which slid 31% to 562,000 tonnes.

Top net imports were from Saudi Arabia at 188,000 tonnes, followed by Malta at 88,000 tonnes and Kuwait at 72,000 tonnes.

Bangladesh remained the top destination for Singapore’s net fuel oil exports for a second consecutive week, with volumes at 89,000 tonnes, followed by the Philippines at 46,000 tonnes and China at 26,000 tonnes.

Oil was steady on Thursday as a surprise drop in US crude stockpiles offset a smaller-than-expected cut to Russian supplies, while investors closely watched developments on Iraqi Kurdistan oil exports.

Zhejiang Petrochemical Corp (ZPC), operator of China’s largest refinery, said on Thursday it has reached a strategic agreement with state refining giant Sinopec on the domestic marketing of its fuel.

Russia’s largest oil producer Rosneft and India’s top refiner Indian Oil Corp have signed a term agreement to substantially increase oil supplies and diversify oil grades delivered to India, Rosneft said.

Syria’s port authority has shut down all the country’s sea ports including Tartous due to poor weather and high winds, state media reported.