SINGAPORE: Asia’s cash premiums for 0.5% very low-sulphur fuel oil (VLSFO) climbed on Tuesday, buoyed by steady cargo demand, while the front-month spread for the marine fuel grade widened its backwardation.

Cash premiums for Asia’s 0.5% VLSFO rose to $17.68 a tonne to Singapore quotes, up from $16.97 per tonne a day earlier.

The March/April VLSFO time spread widened to $21.25 a tonne on Tuesday, compared with $18.25 a tonne on Monday.

The front-month VLSFO crack rose to $20.37 per barrel against Dubai crude during Asian trading hours, compared with $18.92 a barrel in the previous session.

Meanwhile, the 380-cst HSFO barge crack for January traded at a discount of $12.78 barrel to Brent on Tuesday, while cash premiums for 380-cst high sulphur fuel oil (HSFO) were at $1.50 per tonne to Singapore quotes.

India’s fuel demand is likely to grow 5.5% in the next fiscal year beginning April 1, initial government estimates show, reflecting a pick-up in industrial activity and mobility in Asia’s third largest economy after months of stagnation.

India’s fuel consumption in 2022-23, a proxy for oil demand, could rise to 214.5 million tonnes from the revised estimates of 203.3 million tonnes for the current fiscal year ending March 2022, according to government forecasts.