Asia Fuel Oil-VLSFO benchmarks jump on firmer bidding activity
SINGAPORE, Aug 20 (Reuters) -Benchmarks for very low sulphur fuel oil (VLSFO) surged in Asia on Tuesday, with strong bids emerging from a few market participants, trade sources say.
Trading houses Trafigura and Glencore came in with firmer spot bids for September-loading parcels on Tuesday, driving the Singapore VLSFO cash premium above $7 per metric ton.
The activity was also robust in the derivatives market, with cracks for the prompt month also trading higher. The September VLSFO/Dubai crack climbed above $12 per barrel at the Asia close, based on LSEG data. LFO05SGDUBCMc1
Backwardation at the prompt months widened day-on-day to $10 per ton for the September/October contract, according to data from market sources.
Meanwhile, Taiwan's CPC offered 40,000 tons of low sulphur fuel oil for loading in September. The tender closes on Wednesday and is valid until Friday.
CHINA DATA
China's fuel oil imports fell for a third consecutive month in July, customs data showed on Tuesday.
July imports totalled 1.38 million metric tons (about 282,000 barrels per day), 8% lower than in June and down 9% from a year earlier, according to the General Administration of Customs.
Relatively strong cracks for high sulphur fuel oil (HSFO) continued to cap buying interest from Chinese refiners, industry sources say.
Meanwhile, fuel oil export volumes for bunkering totalled 1.66 million tons in July, up 5% from June and 8% higher than in the corresponding month last year.
OTHER NEWS
- Oil prices edged lower on Tuesday as Israel accepting a proposal to tackle disagreements blocking a ceasefire deal in Gaza eased supply concerns and China's economic weakness weighed on the demand outlook. O/R
- China's crude oil imports from top supplier Russia fell in July by 7.4% from a year earlier, official data showed on Tuesday, in line with a broad decline in Chinese refiners' purchases that were curbed by tepid fuel demand at home.
- The National Shipping Company of Saudi Arabia (Bahri) has signed a purchase agreement to acquire nine Very Large Crude Carriers from Capital Maritime and Trading Corporation for approximately 3.75 billion Saudi riyal ($999 million), the company announced on Tuesday.
- Malaysian state energy firm Petroliam Nasional (Petronas) will collaborate with Abu Dhabi National Oil Company (ADNOC) and U.K.-based Storegga to evaluate carbon dioxide emissions storage in Malaysia, the companies said on Tuesday.
WINDOW TRADES O/AS
- 180-cst HSFO: No trade
- 380-cst HSFO: No trade
- 0.5% VLSFO: One trade
ASSESSMENTS
FUEL OIL | ||||
CASH ($/T) | ASIA CLOSE | CHANGE | PREV CLOSE | RIC |
Cargo - 0.5% VLSFO | 571.35 | -3.53 | 574.88 | MFO05-SIN |
Diff - 0.5% VLSFO | 7.25 | 3.35 | 3.90 | MFO05-SIN-DIF |
Cargo - 180cst | 441.52 | -13.49 | 455.01 | FO180-SIN |
Diff - 180cst | 3.38 | -1.12 | 4.50 | FO180-SIN-DIF |
Cargo - 380cst | 435.10 | -12.59 | 447.69 | FO380-SIN |
Diff - 380cst | 4.25 | -0.50 | 4.75 | FO380-SIN-DIF |
Bunker (Ex-wharf) Premium - 380cst | 7.00 | 0.50 | 6.50 | |
Bunker (Ex-wharf) Premium - 0.5% VLSFO | 11.00 | 1.00 | 10.00 |
For a list of derivatives prices, including margins, please double click the RICs below. | |
Brent M1 | BRENTSGMc1 |
180cst M1 | FO180SGSWMc1 |
180cst M1/M2 | FO180SGSDMc1 |
180cst M2 | FO180SGSWMc2 |
Visco M1 | FOVISSGDFMc1 |
Visco M2 | FOVISSGDFMc2 |
380cst M1 | FO380SGSWMc1 |
380cst M1/M2 | FO380SGSDMc1 |
380cst M2 | FO380SGSWMc2 |
Cracks 180-Dubai M1 | FO180SGCKMc1 |
Cracks 180-Dubai M2 | FO180SGCKMc2 |
East-West M1 | FOSGEWMc1 |
East-West M2 | FOSGEWMc2 |
Barges M1 | HFOFARAAMc1 |
Barges M1/M2 | HFOFARAASMc1 |
Barges M2 | HFOFARAAMc2 |
Crack Barges-Brent M1 | HFOFARAACMc1 |
Crack Barges-Brent M2 | HFOFARAACMc2 |
Reporting by Jeslyn Lerh; Editing by Eileen Soreng
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