Spot fuel oil premiums were rangebound in Asia on Tuesday, with heavy supply arrivals capping potential recovery.
Singapore’s cargo cash premium for very low sulphur fuel oil (VLSFO) traded lower at $6 a metric ton, while front-month refining cracks eased to premiums of $12 to $13 a barrel.
Despite supported bunker premiums and higher demand for marine fuel, the recovery in cargo premiums was capped amid the influx of supplies and high inventories this month.
The high sulphur fuel oil (HSFO) market has also stagnated in thin premiums as Russian supplies continued to flow east.
Cargo premium for 380-cst HSFO was pegged relatively unchanged at $4 a ton on Tuesday, while cracks eased to discounts of about $12 to $13 a barrel.
INCOMING SUPPLIES
Total fuel oil arrivals for East of Suez were heavy in January, with volumes breaching 6 million tons, LSEG ship-tracking data showed. Arrivals for East Asia averaged at about 5.2 million tons per month last year.
Regional inflows of low-sulphur blend components and finished-grade LSFO to the Singapore bunkering hub have also remained steady, based on LSEG Oil Research.
OTHER NEWS
– Oil prices were little changed on Tuesday as traders weighed a host of conflicting supply and demand worries, from rising tensions in the Middle East to cold weather woes disrupting production in the United States.
– UAE’s Abu Dhabi National Oil Company has sold more straight-run fuel oil from its Ruwais refinery complex this month via private sales, according to trade sources and ship-tracking data.
– Russia plans to keep February oil exports from its western sea ports little changed from January, but winter weather and refinery maintenance may lead to a revision of the schedule, two industry sources familiar with the plans told Reuters.
– Brazil’s state-run oil firm Petrobras will this year start buying stakes in domestic onshore wind and solar projects to create a roughly 2 gigawatts renewable energy portfolio, the firm’s chief executive told Reuters.
WINDOW TRADES
– 180-cst HSFO: No trade
– 380-cst HSFO: No trade
– 0.5% VLSFO: Three trades
Source: Reuters (Reporting by Jeslyn Lerh; Editing by Shailesh Kuber)