Refining cracks for both high sulphur fuel oil (HSFO) and very low sulphur fuel oil (VLSFO) posted losses for a second straight week in Asia, weighed by bearish fundamentals.
September crack for 380-cst HSFO (FO380BRTCKMc1) closed at a discount wider than $5.35 a barrel, sliding about 30% from the previous week, LSEG data showed.
Meanwhile, VLSFO crack (LFO05SGBRTCMc1) closed at a premium near $8.90 a barrel, posting weekly losses of about 5%.
In the spot market, cash differentials for both grades remained discounted by the end of the trading week, though discounts narrowed week-on-week.
Meanwhile, South Korea’s S-Oil offered two cargoes of slurry, two cargoes of light cycle oil, and a cargo of LSFO for loading in September, via a tender that closes on Friday.
INVENTORY DATA
– ARA fuel oil inventories (STK-FO-ARA) dipped 1.6% to 1.05 million tons in the week to Aug. 21, according to data from Dutch consultancy Insights Global.
OTHER NEWS
– Oil prices rose slightly on Friday as hopes for an imminent peace deal between Russia and Ukraine dimmed, increasing the risk premium demanded by oil sellers and putting prices on track to snap a two-week losing streak.
– China Concord Resources Corp has begun developing two Venezuelan oilfields, planning to invest more than $1 billion in a project to produce 60,000 barrels per day of crude oil by end-2026, an executive directly involved in the project said.
– The Trump administration on Thursday issued more Iran-related sanctions, targeting 13 entities based in Hong Kong, China, the United Arab Emirates and the Marshall Islands, as well as eight vessels, the U.S. Treasury Department said.
– President Donald Trump’s administration is expected to rule on a growing backlog of requests from small oil refiners seeking relief from U.S. biofuel laws as early as Friday, but will delay a decision on whether larger refiners must compensate by boosting their own biofuel blending, according to two sources familiar with the planning.
WINDOW TRADES
– 180-cst HSFO: No trade
– 380-cst HSFO: No trade
– 0.5% VLSFO: No trade
Source: Reuters