Asia’s cash premium for very low sulphur fuel oil (VLSFO) fell below three-month lows on Monday, extending a steady decline since the start of the year.

The region is expected to remain amply supplied this month, with total monthly arrivals likely to breach 6 million metric tons, according to LSEG Oil Research.

Singapore’s cash VLSFO premium MFO05-SIN-DIF fell to $2.75 a ton on Monday, while front-month cracks remained below premiums of $11 a barrel.

High sulphur fuel oil (HSFO) also eased, with the 380-cst cash premium slipping to $6 a ton, while cracks softened to discounts of nearly $11 a barrel.

Meanwhile, Kuwait’s recent Al Zour tender was awarded to PetroChina, according to trading sources. Separately, Indonesia’s Pertamina offered V-1250 for February loading, in a tender that closes on Monday with validity until Jan. 10.

OTHER NEWS

– Oil prices fell by more than 1% on Monday on sharp price cuts by top exporter Saudi Arabia and a rise in OPEC output, offsetting worries about escalating geopolitical tensions in the Middle East.

– India’s Oil and Natural Gas Corp said on Monday it expected total oil output to climb 11% after its project off the country’s east coast started producing oil.

– India’s fuel consumption rose to a seven-month high in December to about 20.054 million metric tons, data from the Petroleum Planning and Analysis Cell (PPAC) of the oil ministry showed.

– Shell on Monday flagged impairment charges of about $2.5 billion to $4.5 billion for the fourth quarter, mainly related to the Singapore refining and chemicals hub that the oil major is looking to sell.

WINDOW TRADES O/AS

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