Refining cracks for very low sulphur fuel oil (VLSFO) extended gains on Monday, while the market structure also retained support amid wider backwardation.
Singapore VLSFO cracks for August closed at premiums of $12.40 per barrel on Monday, after logging weekly gains of more than 10% as of last week, LSEG’s data showed.
Market backwardation for the prompt trading months also widened, based on broker indications.
The market has received a temporary boost in recent sessions amid talk of tighter prompt supply, though some trade sources said this was unlikely to sustain into August.
Spot fuel oil premiums for VLSFO edged slightly higher on Monday, though broader activity was largely thin at month’s end.
Meanwhile, the high sulphur fuel oil (HSFO) market was little changed, though cracks FO380DUBCKMc1 inched higher towards discounts of $4.20 per barrel.
BUNKER UPDATES
TFG Marine, a marine fuel supplier majority owned by commodities trader Trafigura, said on Monday it signed a long-term agreement with Consort Bunkers to charter four new barges that can deliver various low-carbon fuels to ships.
TFG Marine, one of the top three bunker fuel suppliers in the world’s top refuelling port Singapore, will receive the four 6,500-deadweight ton IMO type 2 tankers in late 2024 and into 2025, it said in a statement.
The vessels will be capable of carrying conventional marine fuels and biofuels up to B100, as well as any grade of liquid methanol in the future, TFG Marine said.
OTHER NEWS
– Oil rose on Monday amid fears of a widening conflict in the Middle East following a rocket strike in the Israeli-occupied Golan Heights, which Israel and the United States blamed on Lebanese armed group Hezbollah.
– Nigeria’s major Dangote oil refinery is reselling cargoes of U.S. and Nigerian crude, four trade sources familiar with the matter said.
– Libya’s National Oil Corporation denied holding negotiations to supply crude oil to a refinery in Nigeria.
– Mexico is seeking to import more motor fuel for next year than it had previously planned, to compensate for delays in the startup of its new Olmeca refinery, half a dozen traders said, marking an about-turn by state energy company Pemex.
Source: Reuters (Reporting by Jeslyn Lerh; Editing by Shailesh Kuber)