SINGAPORE: Asia’s front-month 0.5% very low-sulphur fuel oil (VLSFO) cash premium and front-month time spread slipped on Friday but ended the week higher.
The VLSFO market has been supported this week by expectations that arbitrage volumes will recede in the near term following strong inflows in March and April, trade sources said.
The cash premium slipped to $1.50 a tonne to Singapore quotes on Friday, down from a one-month high of $1.25 a tonne on Thursday but up from $1.13 a tonne on Monday.
The front-month VLSFO time-spread also slipped to $1.50 a tonne, down 25 cents from the previous session but up 25 cents from Monday, Refinitiv data in Eikon showed.
The VLSFO refining margin, however, edged higher on Friday despite rising crude oil prices, climbing to $13.51 a barrel above Dubai crude, up from $13.43 in the previous session and 6 cents lower from Monday’s settlement, Refinitiv data in Eikon showed.
The VLSFO crack hit a more than one-month high of $13.76 a barrel on Thursday.
Meanwhile, residual fuel inventories at the Amsterdam-Rotterdam-Antwerp (ARA) and Singapore storage hubs rose this week, while those in Fujairah fell, official data showed.
Fuel oil stocks in the ARA refining and storage jumped by 226,000 tonnes, or 15%, to a two-week high 1.743 million tonnes in the week ended April 15, data from Dutch consultancy Insights Global (IG) showed.
The ARA fuel inventories hit a record high of 1.805 million tonne in the week to April 1. Compared with last year, the inventories at the ARA hub were 18% higher and were also above the five-year seasonal average of 1.242 million tonnes.
In the Fujairah hub, fuel oil stockpiles were 11% lower at a two-week trough of 9.994 million barrels, or 1.574 million tonnes, as exports climbed but trade sources said the local market was well supplied.
In Singapore, fuel oil inventories rose 1% to a more than four-month high of 23.958 million barrels, or 3.773 million tonnes, as net import volumes jumped to an eight-month high.
Two VLSFO cargo trades were reported in the window totalling 40,000 tonnes along with two 380-cst high-sulphur fuel oil (HSFO) cargo trades totalling 40,000 tonnes. The VLSFO deals marked the first VLSFO cargo trades since March 17.
Thailand’s Thaioil offered a 23,000-tonne cargo of 0.5% VLSFO loading from Sriracha between April 26-28. Pakistan’s PSO did not award a tender to import 65,000 tonne of 180-cst high-sulphur fuel oil (HSFO) with a maximum 3.5% sulphur content to Port Qasim over May 1-15.
Trafigura had put in the lowest offer for PSO’s HSFO tender.
China’s 2021 net crude oil imports are forecast to grow 3.4% this year versus 2020 to about 559 million tonnes, according to a research arm of state oil and gas group China National Petroleum Company.
Comments
Comments are closed.