SINGAPORE: Discounts for the front-month 380-cst fuel oil crack to Brent crude narrowed amid weaker crude oil prices on Friday after widening in early trade, but were still trading lower from Thursday.
The June 380-cst fuel oil crack to Brent crude was trading at a discount of about $11.45 a barrel on Friday, up from minus $11.60 a barrel earlier in the day but lower from the discount of $11.30 a barrel in the previous session, broker sources said.
Oil prices fell below $78 a barrel on Friday as OPEC and Russia considered easing supply curbs to offset disruptions in Venezuela and an expected drop in Iranian exports.
INVENTORIES
- Weekly fuel oil stocks in the ARA oil and storage hub fell 7 percent, or 100,000 tonnes, to a two-week low of 1.303 million tonnes in the week ended May 24, data from Dutch consultancy PJK International showed.
- ARA fuel oil stocks declined on growing demand to export to the Middle East ahead of the summer season which sees peak power generation demand there.
- In the week before, a lack of exports boosted ARA fuel oil inventories to a near six-month high of 1.403 million tonnes.
- Compared with last year, ARA fuel oil inventories were 31 percent higher and were well above the five-year average of 0.982 million tonnes for this time of the year.
- Incoming fuel oil cargoes into the ARA hub originated from Poland, Russia and the UK, the data showed, while outgoing cargoes were bound for the Middle East Gulf and the Mediterranean.
- Fuel oil stocks in the Fujairah storage hub this week were also higher, jumping 17 percent to a three-week high of about 1.373 million tonnes in the week to May 21, data via S&P Global Platts showed.
- Meanwhile, fewer net imports dragged Singapore weekly onshore fuel oil inventories 2 percent lower to a total of about 2.737 million tonnes in the week to May 23.
WINDOW TRADES
- Five cargo trades were reported in the Singapore trading window, totalling 120,000
tonnes of 380-cst fuel oil and 20,000 tonnes of 180-cst fuel oil.
- The last time more volume of fuel oil was traded in the Singapore window was on Jan. 24 when 180,000 tonnes of fuel oil exchanged hands.
- Gunvor bought all four 380-cst fuel oil cargoes, two 40,000-tonnne cargoes from Mercuria and two 20,000-tonne cargoes from Trafigura.
- Vitol bought the fifth 180-cst fuel oil cargo from Socar.
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