Asia’s spot fuel oil market eased on Tuesday as cash differentials slipped across key grades, after the market structure softened slightly.

Singapore’s cash premium for 0.5% very low sulphur fuel oil (VLSFO) MFO05-SIN-DIF fell to $27 a metric ton, though refining margin edged higher at a premium of $11.91 a barrel.

The market structure has remained strongly backwardated this month, though timespreads showed signs of softening on Tuesday. The balance-month/Dec backwardation spread for 0.5% VLSFO narrowed $3.50 day-on-day to $29.50 a ton on Tuesday.

High sulphur fuel oil (HSFO) slipped back into discounts amid bearish fundamentals.

The cash differential for 380-cst HSFO fell to a discount of $1.25 a ton, while refining margin dipped to a discount of $14.67 a barrel.

Total fuel oil supply arrivals into Asia are pegged between 5.0 million tons to 5.5 million tons for November, showed LSEG Oil Research data this week.

OTHER NEWS

– Oil prices eased on Tuesday, giving up most of Monday’s gains as mixed economic data from the world’s second largest oil consumer China and winter demand worries offset the impact of Saudi Arabia and Russia extending output cuts.

– Saudi oil giant Aramco on Tuesday reported a 23% fall in third-quarter net profit, marginally beating analyst estimates, on lower crude oil prices and volumes sold.

– India’s fuel consumption rose to a four-month high in October, government data showed, as increased industrial activity boosted sales during the festive season and the onset of winter in the world’s third biggest oil consumer.

– Venezuela’s state-owned PDVSA is in talks with local and foreign oilfield firms to hire equipment and services that would allow it to revive depressed output, sources close to the meetings said, after the U.S. relaxed sanctions on the country.
Source: Reuters (Reporting by Jeslyn Lerh; Editing by Mrigank Dhaniwala)