Asia’s fuel oil market continued to firm on Thursday amid stronger backwardation timespreads, while inventories at key trading hub Singapore fell to three-week lows.
The 380-cst high sulphur fuel oil (HSFO) cash premium climbed to $6.25 a metric ton, while its October/November timespread FO380SGSDMc1 widened by $2.25 day-on-day to $14.25 a ton at the Asia close.
Meanwhile, the 0.5% very low sulphur fuel oil (VLSFO) cash premium was pegged higher at $11 a ton, while October/November timespread climbed $1.30 day-on-day to $14.55 a ton.
Refining margins steadied after gaining in the previous day. The October 380-cst HSFO crack closed at a discount of $10.55 a barrel at the Asia close, while 0.5% VLSFO crack closed at a premium of $8.93 a barrel.
In tenders, Kuwait’s KPC offered 60,000 tons of 380-cst HSFO for loading between Oct. 4 and 5.
SINGAPORE INVENTORIES
Onshore fuel oil stocks fell 9.5% to 19.77 million barrels (3.11 million metric tons) in the week to Sept. 27, Enterprise Singapore data showed.
Brazil was the top origin for Singapore’s fuel oil imports at 252,000 tons, with imports up for a second straight month, while imports from Turkey, which last emerged in early August, appeared at 111,000 tons in the week.
Bangladesh was the top destination for fuel oil exports, at 45,000 tons.
OTHER NEWS
– Oil prices rose in early Asia trade on Thursday after surging to the highest settlement in, as a steep drop in U.S. crude stocks added to worries of tight global supplies.
– Russia is selling oil to India at nearly $80 per barrel, some $20 above the Western price cap, traders said and Reuters calculations showed, as tight global oil markets help Moscow generate strong appetite for its exports.
– Indian conglomerate Vedanta Ltd will separate its commodities businesses into four companies to get better valuations, a source with direct knowledge of the move told Reuters on Thursday.
– A joint venture is developing the first dedicated liquefied natural gas bunkering facility for ships in the U.S. Gulf amid efforts by the maritime industry to find cleaner fuel solutions, executives said on Thursday.
WINDOW TRADES
– 180-cst HSFO: No trade
– 380-cst HSFO: No trade
– 0.5% VLSFO: No trade
Source: Reuters (Reporting by Jeslyn Lerh; Editing by Maju Samuel)