Asia fuel oil benchmarks were broadly stable on Tuesday with largely range-bound bids and offers from the previous day, while some regional spot tenders closed on the same day.
These included a sales tender for low sulphur fuel oil from Taiwan’s Formosa, as well as high sulphur fuel oil tenders from Thailand’s PTT and Pakistan’s PARCO.
The region remains adequately supplied this month, trade sources said. Incoming supplies to Asia totalled about 5 million tons in May, largely unchanged from last month, showed calculations based on LSEG ship-tracking data.
Spot differentials for key fuel oil grades were largely stable from the previous session, with 380-cst HSFO holding in thin discounts on Tuesday, while VLSFO traded at slightly higher premiums.
CHINA DATA
China’s fuel oil imports totalled 1.83 million metric tons for April, up 32% from March but down 38% from April last year, customs data showed.
Poor refining margins and higher importing costs are expected to cap fuel oil imports by Chinese refineries this year, while cracks for HSFO strengthened in recent months, making it more expensive relative to crude.
Meanwhile, exports of low-sulphur marine fuels totalled 1.77 million tons in April, broadly stable from March and climbing 8% from the same month last year.
– Oil prices slipped on Tuesday as traders weighed the impact on supply from Russia-Ukraine peace talks and US-Iran negotiations, strong front-month physical demand in Asia and a cautious outlook for China’s economy.
– Saudi Arabia is expected to burn more crude oil for power generation this summer than last as it ramps up output after OPEC+ eases supply controls and as fuel oil has become costly, analysts and trade sources said.
– Russia has released a Greek-owned oil tanker which was detained in Russian waters on Sunday after leaving an Estonian port, and the vessel has resumed its journey towards the Dutch port of Rotterdam, Estonian public broadcaster ERR reported.
– Nigerian fuel traders are struggling to secure gasoline supplies from two newly refurbished state-run refineries six months after they were declared operational, they say, leaving them reliant on the privately owned Dangote oil refinery and imports.
WINDOW TRADES
– 180-cst HSFO: No trade
– 380-cst HSFO: No trade
– 0.5% VLSFO: One trade
Source: Reuters