Asia’s very low sulphur fuel oil (VLSFO) market weakened on Friday, while trade sources eyed lukewarm bunker demand this week.
Cash premium for VLSFO extended declines for fourth trading session, closing at $8.25 a metric ton.
Cargo trade was largely quiet, with trade sources expecting a lull in the coming week due to the Lunar New Year holidays.
Some sources also noted that bunker demand had been slow in the week, against earlier expectations of more spot demand emerging before the holidays.
Meanwhile, benchmarks for high sulphur fuel oil (HSFO) retained strength due to supply uncertainty in the coming months, with cash premiums holding rangebound.
Refining margins for fuel oil strengthened on Friday in volatile trading. Singapore 380-cst HSFO crack (FO380BRTCKMc1) closed at a discount near $1.65 a barrel, while VLSFO crack (LFO05SGBRTCMc1) closed at a premium at about $11.35 a barrel.
INVENTORY DATA
– Fuel oil inventories in the ARA (STK-FO-ARA) fell 2.5% to 1.42 million tons in the week to Jan. 23, data from Dutch consultancy Insights Global showed.
