Refining margins for Asia high sulphur fuel oil (HSFO) were hovering near three-month lows on Monday as a recent wave of sell-offs continued.

Front-month cracks for 380-cst HSFO closed at discounts near $2 a barrel to crude futures, based on LSEG data.

Spot differentials clung steadily in discounts to cargo quotes, while the prompt market structure remained in contango.

Meanwhile, very low sulphur fuel oil (VLSFO) was largely rangebound. Cracks held near premiums of $11 a barrel to crude, largely stable from the previous session.

In tenders, Indonesia’s Pertamina offered residual fuels for loading in August.

REFINERY UPDATES

– Britain’s insolvent Lindsey oil refinery has secured some crude supplies to stave off immediate closure, the UK energy ministry said, but a source familiar with the situation said the agreement with supplier Glencore was limited.

OTHER NEWS

– Oil pared losses on Monday as a tight physical oil market offset the impact of OPEC+ hiking oil output more than expected in August as well as concern about the potential impact of U.S. tariffs on economic growth and oil demand.
– Saudi Arabia on Sunday hiked August prices for Asian and European buyers by more than $1 a barrel as domestic crude demand is expected to rise, reducing exports and consumption from China is likely to increase.
– Fuel oil imports into the refinery hub on the U.S. Gulf Coast hit a record low in June as tighter global supplies prompted refiners to run more heavy, sour crude.
– An external explosive device most likely caused the blast that damaged Greek oil tanker Vilamoura as it was sailing off the Libyan coast last week, the vessel’s Greece-based operator TMS Tankers said on Sunday, citing an initial investigation.

WINDOW TRADES

– 180-cst HSFO: One trade
– 380-cst HSFO: No trade
– 0.5% VLSFO: No trade
Source: Reuters