SINGAPORE: Asia’s hi-5 fuel oil spread narrowed to 18-month lows on Wednesday as the very low sulphur oil (VLSFO) market remained weak.

The front-month Hi-5, which is the price difference between 0.5% VLSFO and 380-cst high sulphur fuel oil (HSFO), narrowed to $126.75 a tonne at the Asia close (0830 GMT), Refinitiv data showed.

The 0.5% VLSFO cash differential had slumped into a rare discount the previous day, though it rebounded on Wednesday to a premium of 25 cents over Singapore quotes.

Nonetheless, selling interest persisted for loading dates in the later half of April and early May, with offers seen from multiple trading houses but no bid for the grade, reflecting weak spot market fundamentals.

In contrast, the 380-cst HSFO market held steady despite strong supplies into Asia, amid prospects of higher seasonal demand.

Residual fuel oil stocks at Fujairah fell by 13% to 10.05 million barrels (1.58 million tonnes) in the week ended April 3, hitting seven-week lows, showed Fujairah Oil Industry Zone data published by S&P Global Commodity Insights.

Oil prices were stable on Wednesday, as the market weighed gloomy economic prospects against expectations of US crude inventory declines and OPEC’s voluntary output cuts announcement.

India’s Bank of Baroda has stopped clearing payments for Russian oil sold above the price cap set by the West from this month, three sources with direct knowledge of the matter said, a move that could expedite transition to a rupee trade mechanism.

Venezuela’s oil exports rose in March to the highest monthly average since August, boosted by a resumption of loadings after an export freeze and by rising cargoes assigned to Chevron Corp, according to documents and shipping data.

Finnish biofuel producer Neste plans to start commercial production at its renewable fuels expansion project in Singapore in the coming weeks after trial runs, a senior company executive said on Wednesday.