Asia’s spot market for very low sulphur fuel oil (VLSFO) traded in discounts on Thursday for December loading dates, with cash differentials sliding to their lowest since mid-April this year.
The product traded at a discount of 25 cents a metric ton to cargo quotes for the prompt laycan, while offers also trended down for later dates in December.
High sulphur fuel oil (HSFO) benchmarks also continued to soften, with offers slipping day-on-day into narrower premiums.
Onshore inventories of fuel oil in Singapore dropped slightly week-on-week but remained higher than last month’s average, official data showed on Thursday.
Supply inflows remained strong in the week to Dec. 4, with most imports hailing from the United States, Saudi Arabia and Indonesia, excluding cargo movements from Malaysia.
Arbitrage barrels from the West have remained strong, while Middle Eastern supplies and regional supplies from Asian refiners were also seen rangebound, according to trade sources.
Meanwhile, most fuel oil outflows out of Singapore storage tanks were headed for South Korea, China and Bangladesh in the week.
INVENTORY DATA
– Singapore onshore fuel oil stockpiles STKRS-SIN fell 2.3% to 18.79 million barrels (about 2.96 million metric tons) in the week to Dec. 4, easing to two-week lows, based on Enterprise Singapore.