Cash premiums for fuel oil climbed in Asia on Tuesday as trading momentum retained its robust pace in recent sessions.

The 380-cst high sulphur fuel oil (HSFO) differential was pegged at a premium above $12 a metric ton, with a flurry of trades persisting on the window.

Meanwhile, very low sulphur fuel oil (VLSFO) traded at a largely stable premium of $7 a metric ton.

Refining margins closed lower for both grades with crude futures edging higher in the day.

Prompt-month cracks for HSFO closed into discounts versus both Brent and Dubai quotes, respectively, while VLSFO cracks closed at premiums slightly above $10 a barrel.

REFINERY UPDATES

– U.S. oil refiners are expected to have about 210,000 barrels per day (bpd) of capacity offline in the week ending June 13, increasing available refining capacity by 66,000 bpd, research company IIR Energy said this week.

OTHER NEWS

– Oil prices climbed on Tuesday as investors awaited the outcome of U.S.-China trade talks and as Saudi Arabia’s crude supply to China is set to dip slightly.

– Saudi Arabia’s crude oil supply to China is set to dip slightly in July, trade sources said on Tuesday, but still strong for a third straight month as the OPEC kingpin regains its market share supplying the world’s top crude importer.

– Japanese refinery Taiyo Oil has bought its first Sakhalin Blend crude from Russia in more than two years at the Japanese government’s request, it said on Tuesday, to help ensure the stability of a plant also supplying Japan with liquefied natural gas.

– Nigeria and Saudi Arabian oil company Aramco are struggling to reach an agreement on a record $5 billion oil-backed loan after a recent decline in crude prices sparked concern among banks that were expected to back the deal, four sources told Reuters.

WINDOW TRADES

– 180-cst HSFO: No trade

– 380-cst HSFO: Seven trades

– 0.5% VLSFO: Three trades
Source: Reuters