Cash differentials for fuel oil extended declines in Asia on Wednesday, weighed by soft marine fuel demand in recent days.
The spot very low sulphur fuel oil (VLSFO) market weakened to a premium below $6 a metric ton, though refining crack retained support above $15 a barrel.
The market has recently been weighed by tepid bunkering demand at Singapore, which slowed in February following strong volumes in January.
Bunker premiums for VLSFO have softened sharply compared to last month, with sellers slashing prices to entice uptake from shippers, trade sources said.
Meanwhile, high sulphur fuel oil (HSFO) benchmarks remained in discounts on the back of persistent supply pressure. Refining margins for the 380-cst grade slipped day-on-day to discounts below $14 a barrel.
In refinery news, Oman’s newly inaugurated Duqm refinery, OQ8, may start processing more crude grades towards the end of the year with studies currently underway, CEO David Bird told Reuters.
This could mean more HSFO exports coming out of Oman, further dampening a market that is already bearish, an industry analyst said.
BUNKER UPDATES
– Marine fuel supplier TFG Marine, majority-owned by commodities trader Trafigura, has entered into an agreement with Oman’s SOHAR Port and Freezone to set up its first Middle Eastern bunker fuel supply, the companies said in a statement.
– Anglo American PLC has taken delivery of its tenth and final dual-fuelled bulk carrier powered by liquefied natural gas, the company said on Wednesday.
Source: Hellenic Shipping News
