The market for very low sulphur fuel oil (VLSFO) softened in Asia for a third straight session on Monday, as lower offers emerged for loading dates in end-May and early-June.
The cash premium for 0.5% VLSFO fell to $6.25 a tonne, though front-month margin (LFO05SGDUBCMc1) closed higher at a premium of $8.17 a barrel by 0830 GMT.
The downside to VLSFO cracks was limited by the continued diversion of bunker activities from Zhoushan to Singapore, amid the Labor Day Golden Week holiday in China and refinery maintenance in Zhoushan, said FGE analysts.
Meanwhile, the high sulphur fuel oil (HSFO) market saw viscosity spreads narrowing again in recent trading sessions. The cash viscosity spread was pegged at $1.20 a tonne on Monday, narrowing by more than $1, compared to the previous session.
Cash premium for 380-cst HSFO closed higher at $5.82 a tonne amid a wider market backwardation, while front-month margin firmed to a discount of $9.12 a barrel at 0830 GMT.
In recent tenders, Vietnam’s Nghi Son offered 8,000 tonnes of fuel oil for loading between May 26 and 28, with bids to be submitted by Tuesday.
OTHER NEWS
– Oil prices rose slightly on Monday as amid receding fears of a recession in the U.S., which drove prices down for three straight weeks for the first time since November.
– China’s privately controlled refiner Shenghong Petrochemical has been granted a crude oil import license, according to the local government of east China’s Lianyungang city, where the company is based.
– Vietnam’s Binh Son Refining and Petrochemical will take $754 million worth of loans for a project to expand its sole oil refinery and boost its annual crude oil processing capacity by more than 1 million tonnes, the company said.
– Shares of Australian liquefied natural gas producers rose on Monday after the government adopted more favourable-than-expected changes to petroleum tax, ensuring the load was shared across the industry and did not impact growth projects.
WINDOW TRADES
– 180-cst HSFO: No trade
– 380-cst HSFO: No trade
– 0.5% VLSFO: One trade
Source: Reuters