Asia’s high sulphur fuel oil (HSFO) market extended declines on Wednesday, while latest customs data showed a fall in China’s fuel oil imports for a second consecutive month.
Spot cash premium for 380-cst HSFO FO380-SIN-DIF slipped further to $2.75 a metric ton, hitting 12-week lows.
The market has come under downward pressure in recent sessions, weighed by lower demand expectations from the Middle East as summer retreats, as well as less imports by China.
Fuel oil imports in China were down 8% from July to 1.4 million metric tons in August, though still more than double compared to the same period last year, customs data showed.
The decline came amid a recovery in China’s diluted bitumen imports after customs authorities eased months-long inspections.
Asia’s refining margin for 380-cst HSFO was at a discount of $13.20 a barrel at Wednesday’s Asia close (0830 GMT), rebounding slightly after hitting a five-month low on Tuesday.
Meanwhile, the very low sulphur fuel oil (VLSFO) market continued to firm, though cash differentials remained in single-digit premiums.
The 0.5% VLSFO cash premium MFO05-SIN-DIF rose to $8.50 a metric ton on Wednesday, while October crack LFO05SGDUBCMc1 gained at a premium of $7.86 a barrel.
FUJAIRAH INVENTORIES FUJAIRAH/
Fuel oil inventories at Fujairah FUJHD04 climbed 12% to 10.19 million barrels (1.60 million tons) in the week to Sept. 18, showed Fujairah Oil Industry Zone data published by S&P Global Commodity Insights.
Source: Hellenic Shipping News
