Spot fuel oil premiums fell in Asia on Tuesday as supplies remained plentiful, while most Middle Eastern loadings remained unaffected by regional tensions, trade sources said.

High sulphur fuel oil (HSFO) traded lower in the spot market, while backwardation narrowed and cracks weakened.

Incoming supplies from the Middle East totalled about 1.5 million tons for this month, stable to slightly higher from last month, calculations based on LSEG ship-tracking data showed.
The geopolitical situation remained volatile as of Tuesday despite U.S. President Donald Trump saying a ceasefire between Israel and Iran had been agreed, though cargo loadings in the Middle East have mostly been proceeding as per normal, trade sources said.

Meanwhile, the very low sulphur fuel oil (VLSFO) market also softened as spot offers declined from the previous day.

A fuel oil cargo from Kuwait’s al-Zour refinery totalling 130,000 tons was withdrawn, trade sources said, though this did not have an impact on prices. The cargo was initially scheduled to load in early July, according to a shipbroker.

OTHER NEWS

– Oil fell on Tuesday after Israel agreed to U.S. President Donald Trump’s proposal for a ceasefire with Iran, alleviating worries of supply disruptions in the Middle East.
– War risk insurance premiums for shipments to the Middle East Gulf have jumped to 0.5% from around 0.2%-0.3% a week ago after U.S. airstrikes on Iran’s nuclear facilities and growing risks to the critical Strait of Hormuz, insurance sources said.
– Venezuela’s second-largest refinery, the 310,000-barrel-per-day Cardon plant operated by state company PDVSA, remained halted on Monday after a power blackout, three sources with knowledge of its operations said.
– Shipping costs for liquefied natural gas cargoes have rallied to their highest in about eight months with vessel availability tightened by a shift in more ships heading to Asia at the same time as conflict has escalated in the Middle East.

WINDOW TRADES

– 180-cst HSFO: No trade
– 380-cst HSFO: Two trades
– 0.5% VLSFO: No trade
Source: Reuters