Asia’s spot market differentials for key fuel oil grades closed in range-bound discounts from the previous session, with several trades emerging for 380-cst high sulphur fuel oil (HSFO) at similar values from the previous day.
Active trading prevailed on Friday for the 380-cst grade at discounts of $6 per metric ton to cargo quotes. Meanwhile, 180-cst grade was offered at much steeper discounts from a floating storage.
High supply inventories in the Asia region have been putting a lid on fuel oil markets.
However, the very low sulphur fuel oil (VLSFO) market logged a bit of recovery at the end of the week, with spot discounts narrowing to near $1 a ton. Market structure remained in contango for the prompt months.
Fuel oil cracks were range-bound from the previous day. The VLSFO crack for December held above a premium of $7 a barrel, while 380-cst HSFO crack was broadly stable at a discount near $5 a barrel, showed data compiled by LSEG.
INVENTORY DATA
– ARA fuel oil inventories rose 15.3% to 1.06 million tons in the week to November 6, based on data from Dutch consultancy Insights Global.
WINDOW TRADES
– 180-cst HSFO: No trade
– 380-cst HSFO: Five trades
– 0.5% VLSFO: No trade
Source: Reuters
