The cash differential for 180-cst high sulphur fuel oil (HSFO) flipped from a premium to a discount on Monday, with spot offers softening for loading dates from end-June to early-July.
The HSFO market has been weighed by low uptake from South Asia despite an ongoing heat wave, as imports from the region dropped compared to last year.
Fuel oil imports into South Asia totalled about 2.07 million tonnes in the second quarter of 2023 so far, sliding sharply from 4.37 million tonnes in the same quarter last year, Refinitiv ship-tracking data showed Monday.
The cash differential for 180-cst HSFO (FO380-SIN-DIF) slipped to a discount of $3 a tonne to Singapore quotes, versus a thin premium in its previous session, as the product traded lower.
Meanwhile, the very-low sulphur fuel oil (VLSFO) market rebounded slightly at the start of a fresh trading week amid firmer bids. The market’s cash differential climbed to a premium of $5.50 a tonne, while front-month margin closed at a premium of $11.13 a barrel at 0830 GMT.
OTHER NEWS
– Oil prices fell on Monday ahead of a U.S. Federal Reserve meeting as investors tried to gauge the central bank’s appetite for further rate hikes, while concerns about China’s fuel demand growth and rising Russian crude supply weighed on the market.
– Pakistan’s Prime Minister Shehbaz Sharif on Sunday said the first cargo of discounted Russian crude oil arranged under a new deal struck between Islamabad and Moscow had arrived in Karachi.
– Canadian biofuels producers are threatening to build their next projects in the United States to cash in on rich subsidies for clean fuel and stay competitive, a move that could cost Canada C$10 billion ($7.5 billion) of investment and undermine Prime Minister Justin Trudeau’s efforts to build a greener economy.
– The number of fossil fuel companies setting net-zero emissions targets has risen sharply over the past year, but most fail to address key concerns, making them “largely meaningless”, a report showed on Monday.
WINDOW TRADES
– 180-cst HSFO: One trade
– 380-cst HSFO: No trade
– 0.5% VLSFO: No trade
Source: Reuters