Spot premiums for high sulphur fuel oil (HSFO) extended further declines on Friday, while the hi-five spread showed some rebound versus the previous week.
The premium of VLSFO over 380-cst HSFO, also known as the hi-5, closed slightly above $105 a metric ton, based on LSEG data.
The hi-five fell to its narrowest premium in more than five months last week, amid a weaker market for very low sulphur fuel oil (VLSFO). The spread widened again this week after HSFO also started softening.
Spot offers for 380-cst HSFO continued to trend lower for prompt loading dates, weighing on cash premiums.
Meanwhile, spot premiums for VLSFO steadied at the end of the trading week, after sliding to their weakest since mid-April. Trade sources said that discussions were mostly thin.
Refining margins for VLSFO were largely stable at about $11 a barrel, while margins for 380-cst HSFO fell to discounts of about $5.40 a barrel, nearly halving compared to last week.
INVENTORY DATA
– Fuel oil inventories in the ARA rose 13.1% to 1.34 million tons in the week to Dec. 5, data from Dutch consultancy Insights Global showed.
Source: Reuters (Reporting by Jeslyn Lerh; Editing by Vijay Kishore)
