Asia Fuel Oil-VLSFO extends slide as ample supply faces lukewarm demand
SINGAPORE, Dec 10 (Reuters) -Asia's very low sulphur fuel oil (VLSFO) market weakened further on Tuesday as the market eyed ample supply arrivals, which have been met with lukewarm downstream demand.
Refining margins extended declines, with VLSFO cracks trading lower day-on-day. Singapore's crack spread for VLSFO closed near premiums of $9 per barrel, holding at over five-month lows, according to LSEG data. LFO05SGDUBCMc1
Meanwhile, market backwardation for prompt months continued to ease amid the latest selling wave, trade sources said.
The backwardation for January-February VLSFO narrowed sharply, trading down to as low as 25 to 50 cents per metric ton during the day, said sources.
Cracks for 380-cst high sulphur fuel oil (HSFO) held between discounts of $5 to $5.50 per barrel, stabilising after dropping the previous day. FO380DUBCKMc1
In tender sales, Indonesia's Pertamina offered three cargoes of low-sulphur waxy residue and one cargo of marine fuel oil for loading in January, showed data from industry sources. The tender closed on Tuesday.
INCOMING SUPPLIES
- Total fuel oil supplies to Asia are expected to breach 6.5 million tons in December just like last month, remaining above this year's monthly average volume, calculations based on LSEG ship-tracking data showed this week.
OTHER NEWS
- Oil prices climbed on Monday after the fall of Syrian President Bashar al-Assad's regime introduced greater uncertainty to the Middle East, although the gains were capped by a waning demand outlook for the coming year. O/R
- Private Chinese refiner Hengli Petrochemical has snapped up Middle East crude, six traders familiar with the matter said, mostly from TotalEnergies after the French major amassed a large volume of the oil and as Iranian supply to China has tightened.
- Swiss prosecutors are seeking a total of over $156 million in penalties and compensation from Trafigura and a four-year jail sentence for former Chief Operating Officer Mike Wainwright at an ongoing corruption trial in Switzerland, a spokesperson for the Attorney General's Office said.
- Average U.S. gasoline prices fell below $3 a gallon for the first time in over three years, extending a run of bargains at the pump for consumers who have faced soaring inflation in recent years.
WINDOW TRADES O/AS
- 180-cst HSFO: No trade
- 380-cst HSFO: No trade
- 0.5% VLSFO: No trade
ASSESSMENTS
FUEL OIL | ||||
CASH ($/T) | ASIA CLOSE | CHANGE | PREV CLOSE | RIC |
Cargo - 0.5% VLSFO | 512.77 | -5.14 | 517.91 | MFO05-SIN |
Diff - 0.5% VLSFO | 0.15 | -0.10 | 0.25 | MFO05-SIN-DIF |
Cargo - 180cst | 432.99 | -1.78 | 434.77 | FO180-SIN |
Diff - 180cst | 3.95 | -1.55 | 5.50 | FO180-SIN-DIF |
Cargo - 380cst | 423.47 | -1.94 | 425.41 | FO380-SIN |
Diff - 380cst | 3.30 | -1.55 | 4.85 | FO380-SIN-DIF |
Bunker (Ex-wharf) Premium - 380cst | 12.00 | -0.50 | 12.50 | |
Bunker (Ex-wharf) Premium - 0.5% VLSFO | 6.00 | -0.50 | 6.50 |
For a list of derivatives prices, please refer to ENSWAP/INFO or the RICs below: | |
180cst M1 | FO180SGSWMc1 |
180cst M1/M2 | FO180SGSDMc1 |
380cst M1 | FO380SGSWMc1 |
380cst M1/M2 | FO380SGSDMc1 |
0.5% VLSFO M1 | LFO05FSGMc1 |
0.5% VLSFO M1/M2 | LFO05FSGSMc1 |
Cracks 180cst-Brent M1 | FO180BRTCKMc1 |
Cracks 180cst-Dubai M1 | FO180SGCKMc1 |
Cracks 380cst-Brent M1 | FO380BRTCKMc1 |
Cracks 380cst-Dubai M1 | FO380DUBCKMc1 |
Cracks 0.5% VLSFO-Brent M1 | LFO05SGBRTCMc1 |
Cracks 0.5% VLSFO-Dubai M1 | LFO05SGDUBCMc1 |
Visco 180cst/380cst M1 | FOVISSGDFMc1 |
Hi-5 0.5% VLSFO/380cst M1 | FO05-380SGMc1 |
GoFo 10PPM/0.5% VLSFO M1 | GO10FO05FSGMc1 |
East-West M1 | FOSGEWMc1 |
Barges M1 | HFOFARAAMc1 |
Barges M1/M2 | HFOFARAASMc1 |
Crack Barges-Brent M1 | HFOFARAACMc1 |
Reporting by Jeslyn Lerh; Editing by Arun Koyyur
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