Asia’s cash differential for 380-cst high sulphur fuel oil (HSFO) spiked to a 16-month high on Wednesday, as bids continued to firm day-on-day on tight prompt supplies.
The product’s cash differential soared to a premium of $29.40 per metric ton, a level last higher in April 2022, while front-month crack climbed to a discount of $5.59 a barrel.
“Cracks are high and crude prices are also high, it’s tough (to deal) in the high-sulphur market this week,” a Singapore-based fuel oil trader said.
The rally emerged despite easing Chinese demand, with some industry sources skeptical of whether such prices could sustain.
In the downstream bunkering market, 380-cst marine fuel oil premiums have also risen amid the surge in cargo premiums, though lagging the extent of the increase, traders said.
Meanwhile, the very-low sulphur fuel oil (VLSFO) spot market was range-bound in single-digit premiums to cargo quotes.
The cash differential for 0.5% VLSFO was pegged at a premium of $3.57 a metric ton, while front-month margin rose to a premium of $10.51 a barrel.
In tenders, Indonesia’s Pertamina offered marine fuel oil for loading in September.
FUJAIRAH INVENTORIES FUJAIRAH/
Fuel oil inventories at Fujairah FUJHD04 dipped 2% at 9.49 million barrels (1.49 million tons) in the week to July 31, showed Fujairah Oil Industry Zone data published by S&P Global Commodity Insights.
Source: Hellenic Shipping News
