Asia’s refining margin for 380-cst High Sulphur Fuel Oil (HSFO) closed at a nine-month high on the last day of May, data showed, supported by tight incoming supplies this month.
The prompt-month crack was pegged at a discount of $3.85 a barrel on Friday, based on LSEG data at 0830 GMT.
Total supplies to Asia have dropped this month, led by lower arrivals from the Middle East and Russia as peak summer demand from the Middle East kept more barrels in that region.
However, cash premiums for 380-cst HSFO eased on Friday as a lower offer emerged for some loading dates in the second half of June.
Trade sources expect a slight recovery in inventories during then, on the back of softer demand from China amid the high prices.
Meanwhile, benchmarks for Very Low Sulphur Fuel Oil (VLSFO) remain capped by lukewarm demand.
Cash premiums for VLSFO closed at levels below $4 a ton on Friday, while delivered bunker premiums remained near year-to-date lows of below $10 a ton, based on market sources. Cracks were stable at premiums of $8.40 a barrel.
Source: Hellenic Shipping News
