Refining crack spreads for fuel oil fell on Monday after trading participants engaged in a wave of selling activity, based on market sources and pricing data.
Singapore’s January crack spread for very low sulphur fuel oil (VLSFO) dived below premiums of $10 per barrel on Monday, as of the Asia close (0830 GMT), hitting more than five-month lows, showed LSEG data.
The derivatives market has weakened in recent sessions, with selloffs persisting, while heavy supplies weighed on the broader market.
High sulphur fuel oil (HSFO) margins also softened, with 380-cst HSFO cracks sliding toward discounts of $6 per barrel on Monday.
Meanwhile, the spot market retained downward pressure, with HSFO trading at softer cash premiums to cargo quotes, extending their recent slide. Front-month backwardation narrowed for HSFO and VLSFO.
REFINERY UPDATES
– U.S. oil refiners are expected to have about 89,000 barrels per day of capacity offline in the week ending Dec. 6, raising available refining capacity by 85,000 bpd, research company IIR Energy said.
Source: Reuters
