Asia’s very low sulphur fuel oil (VLSFO) market extended gains on Tuesday amid a tighter supply outlook, with market backwardation remaining strong.

The cash premium for 0.5% VLSFO MFO05-SIN-DIF firmed for a fifth consecutive session at $16.74 a metric ton on Tuesday, while November crack LFO05SGDUBCMc1 edged higher to a premium of $9.27 a barrel.

Market backwardation held steadily strong, with the October/November timespread LFO05FSGSMc0 closing at $21.50 a ton at the Asia close, hitting about four-month highs.

In contrast, 380-cst high sulphur fuel oil trended softer, with cash premium sliding to $2.95 a ton, while November crack FO380DUBCKMc1 slipped to a discount of $15.42 a barrel.

In tenders, Malaysia’s RAPID offered 55,000 barrels of slurry for loading from Pengerang between Oct. 26 and 27. The tender closes on Tuesday.

OTHER NEWS

– Oil prices dipped in early Asia trade on Tuesday on a strengthening U.S. dollar and traders taking some money off the table from the last quarter’s chunky gains.

– Seaborne diesel and gasoil exports from Russian ports fell 27% in September from a month earlier to about 2.76 million tonnes due to a major overhaul of refineries and a fuel export ban, data from traders and LSEG showed.

– Japan’s biggest refiner, Eneos Corp, restarted the 141,000 barrels-per-day crude distillation unit at its Sakai refinery in western Japan on Sept. 19 after an unscheduled shutdown on Sept. 4, a company spokesperson said on Tuesday.

– Japan’s top oil and gas producer and its partners have agreed to study developing a low-carbon ammonia production and export project on the Houston Ship Channel in the United States, Inpex said on Tuesday.

WINDOW TRADES O/AS

– 180-cst HSFO: No trade
– 380-cst HSFO: No trade
– 0.5% VLSFO: Three trades
Source: Reuters (Reporting by Jeslyn Lerh; Editing by Shailesh Kuber)