Spot premiums for key fuel oil grades inched lower on the final trading day of the month, while refining cracks were largely rangebound.
The 0.5% low sulphur fuel oil (VLSFO) market has shown signs of easing for late-October dates, a sign that supply replenishment is underway, industry sources said.
Singapore’s VLSFO cash premium was pegged lower at $9.50 per metric ton on Monday, though front-month cracks LFO05SGDUBCMc1 inched slightly higher to premiums of about $14.60 a barrel.
Meanwhile, spot benchmarks for 380-cst high sulphur fuel oil (HSFO) also showed signs of softening amid lower-priced offers for dates in the second half of October, with the cash premium falling below $14 per ton on Monday, while cracks for 380-cst HSFO FO380DUBCKMc1 held near discounts of $9 a barrel.
In tenders, Taiwan’s CPC is offering 35,000 tons of low sulphur fuel oil for October loading. The tender closes on Monday and is valid until Wednesday, a note on the company’s website showed.
REFINERY UPDATES REF/OUT
– Russia’s Antipinsky and Novokuibyshevsk oil refineries halted processing this month for planned maintenance, industry sources said.
– U.S. oil refiners are expected to have about 1.09 million barrels per day of capacity offline in the week ending Oct. 4, decreasing available refining capacity by 4,000 bpd, research company IIR Energy said on Monday.
OTHER NEWS
– Oil prices rose for a second consecutive session on Monday, with concerns escalating over potential supply disruptions in the Middle East after Israel stepped up attacks on Palestinian militant group Hamas and Iranian-backed forces in the region.
– Rising U.S. crude oil exports are boosting the prominence of Gulf Coast price benchmarks and buoying trading volumes on Houston contracts, eroding the significance of the Cushing, Oklahoma, storage hub.
– Russian Deputy Prime Minister Alexander Novak expects oil prices’ fluctuations will subside following volatility spurred by the tensions in the Middle East as geopolitical risks are already factored in, he told Al Arabiya News.
– Mexico’s Pemex this month shipped its first fuel export cargo from its new Olmeca refinery to India, a sign of progress after multiple delays and spiraling costs, according to shipping data and industry sources.
WINDOW TRADES
– 180-cst HSFO: No trade
– 380-cst HSFO: No trade
– 0.5% VLSFO: Two trades
Source: Reuters (Reporting by Jeslyn Lerh; Editing by Eileen Soreng)