Spot premiums for fuel oil dipped in Asia on Thursday, with lower-priced offers emerging for the second half of August.

Singapore’s premium for both the low-sulphur market (VLSFO) and high-sulphur market (HSFO) fell below $6 per metric ton on Thursday, compared with premiums above $7.50 in end-July.

Prompt supply tightness had previously kept benchmarks supported, though some market sources expected this to ease into the second half of the month.

Market backwardation between August and September eased for all the key fuel oil grades on Thursday.

Meanwhile, Taiwan’s CPC this week sought low-sulphur fuel oil for delivery between September and October at Keelung.

INVENTORY DATA

– Singapore onshore inventories STKRS-SIN dipped 1.5% to 19.56 million barrels (3.08 million metric tons) in the week ended July 31, as imports trended lower, Enterprise Singapore data showed.

OTHER NEWS

– Oil prices rose during Asian trade on Thursday, extending gains from the previous session, after the killing of a Hamas leader in Iran raised the threat of a wider Middle East conflict and concern over its impact on oil.

– Top oil exporter Saudi Arabia may raise prices for crude it sells to Asia for the first time in three months in September, tracking a rise in Middle East benchmark Dubai, traders said on Thursday.

– SK Innovation said on Thursday it expects strong oil refining margins in the second half of the year as OPEC+ production cuts buoy prices and the peak demand season for transportation, cooling and industrial use begins.

– Electricity-hungry Vietnam wants liquefied natural gas to fire 15% of power capacity by 2030 but is unlikely to meet that target as power producers and foreign investors balk at the country’s strategy for making the super-chilled fuel affordable.

WINDOW TRADES

– 180-cst HSFO: No trade
– 380-cst HSFO: No trade
– 0.5% VLSFO: No trade
Source: Reuters (Reporting by Jeslyn Lerh; Editing by Shreya Biswas)