Asia’s very low sulphur fuel oil (VLSFO) market eased week-on-week, while high sulphur fuel oil (HSFO) market clung to its recent strength.
Singapore’s VLSFO cash differential inched further down on Friday, closer to a premium of $10 a metric ton, while bunker premiums retreated in lukewarm buying. Cracks also logged weekly declines, based on LSEG data.
Meanwhile, cash differential for 380-cst HSFO closed the trading week in premiums, undergoing some volatile swings near parity to cargo quotes in recent sessions.
Cracks for HSFO were stable to stronger from the previous week, holding near latest highs reached.
Despite the stronger cracks, trade sources said that Asia market continues to be underpinned by tepid demand and adequate inventories in the spot market.
INVENTORY DATA
– ARA fuel oil inventories (STK-FO-ARA) dipped 1.3% week-on-week to 1.10 million tons in the week to May 22, based on data from Dutch consultancy Insights Global.
OTHER NEWS
– Oil prices dropped for a fourth consecutive session on Friday and were set for their first weekly decline in three weeks, weighed down by renewed supply pressure from another possible OPEC+ output hike in July.
– Spot premiums for Murban crude have hit six-month lows on surging supply as the United Arab Emirates ramps up output following OPEC+’s decision to accelerate production hikes and compete head-on with U.S. shale oil, traders and analysts said.
– Hungarian oil and gas group MOL and state-owned energy company MVM will jointly charter tankers to ship up to 160,000 metric tons of crude oil a year from Azerbaijan to further diversify energy supply for Hungary and Slovakia, MOL said.
– Mexico’s Pemex, the world’s most indebted energy company, plans to restructure parts of its business in an attempt to save costs, a May document seen by Reuters showed on Thursday.
WINDOW TRADES
– 180-cst HSFO: No trade
– 380-cst HSFO: No trade
– 0.5% VLSFO: One trade
Source: Reuters