The front-month time spreads of the Singapore 380-cst fuel oil edged lower on Thursday, despite a moderate decline in Singapore fuel oil stocks, as traders cashed in their bullish positions due to the month end, traders said.
“It’s the end of the month and some of the bullish positions need to be closed given the bull story that’s been circulating around recently because of tighter supplies,” said a Singapore-based trader.
The front-month Oct/Nov time spreads for the 380-cst fuel oil was 30 cents lower on Thursday at 70 cents a tonne to Singapore quotes on the Intercontinental Exchange (ICE) by 17:15 Singapore time (0915 GMT), industry sources said.
The further dated Nov/Dec time spreads were also trading lower at 25 cents a tonne to Singapore quotes on ICE, down by 10 cents from the previous session.
There was a weaker backwardated market structure despite a 1.3 percent drop in Singapore’s fuel oil inventories when many industry participants were anticipating a slight increase instead.
Onshore fuel oil stocks held by up to 13 oil and oil storage companies in Singapore slipped by 323,000 barrels (or about 48,000 tonnes) to a two-week low of 24.01 million barrels (3.58 million tonnes) in the week to Sept. 28, according to data from International Enterprise (IE) Singapore on Thursday.
In cash deals, Mercuria bought two 20,000 tonne cargoes of 380-cst fuel oil from Hin Leong at $257 and $256 a tonne for delivery between Oct. 14-18 and Oct. 19-23, industry sources said.
Although Mercuria has not placed any bids for the 380-cst fuel in the Platts window since Aug. 29 while actively offering 380-cst cargoes instead, one trader pointed out the deals price levels were “very good”.
LATEST TENDERS & AWARDS: For further details, please see OUTSTANDING ASIA/MIDEAST FUEL OIL TENDERS: ISSUER GRADE: VOLUME: DELIVERY CLOSE (VALID) DATE: Taiwan/Formosa S: 380cst max 4% S 40KT Oct 13-15 Sept 30 (Mailiao) UAE/ADNOC S: SRFO (Ruwais) 80KT Oct 15-17 Oct 4 Thailand/IRPC S: LCO (Rayong) 5KT Oct 28-30 Sept 29 India/Reliance S: CBFS max 1.7% S 20KT Oct 19-20 Sept 28 (Sept 29) (Sikka) S: CBFS max 3% S 60KT Oct 19-20 Sept 28 (Sept 29) (Sikka) Pakistan/PSO B: 125cst HSFO 65KT x8 Nov 1-Dec 10 Oct 4 (Oct 14) 65KT x10 Dec 11-Jan Oct 4 (Oct 14) 15 65KT x5 Jan 16-Feb Oct 4 (Oct 14) 15 B: 120cst LSFO 60KT Nov Oct 4 (Oct 14) 60KT x2 Dec Oct 4 (Oct 14) 60KT Jan Oct 4 (Oct 14) RECENT ASIA/MIDEAST FUEL OIL TENDER AWARDS, SPOT SALES: ISSUER GRADE: VOLUME: DELIVERY RESULT DATE: India/IOC B: 180cst LSFO 1% S 15KT Nov 15-19 Glencore/ 180 MOPAG around +$65 (Mangalore) CFR or FOB India/IOC S: 380cst (Chennai) 35KT Oct 22-24 Gunvor/ 380 MOPS & Argus Avg -$6-$7 India/IOC S: 380cst (Chennai) 35KT Oct 14-16 Gulf Petrochem/ 380 MOPS & Argus Avg -$6-$7 Thailand/IRPC S: LCO (Rayong) 5KT Sept 28-30 Chevron/ 180 MOPS +$80-90 Sri B: 180cst LSFO 1.8% S 25KT Oct 12-13 Glencore/ 180 MOPS +$40-$50 DES Lanka/Ceypetco (Muthurajawela) India/IOC S: 380cst (Chennai) 35KT Oct 1-3 Gulf Petrochem/ 380 MOPS & Argus Avg -$6-$7 Taiwan/Formosa S: 280cst HSFO 40KT Sept 16-18 Glencore/ 180 MOPS -$13-$14 FOB (Mailiao) Taiwan/Formosa S: 380cst max 4% S 40KT Oct 1-3 PetroChina/ 180 MOPS -$15 FOB (Mailiao) RELATED STORIES: - It was a moment U.S. shale oil producers have been waiting on for more than two years: OPEC nations finally agreed to cut production on Wednesday in a move that lifted low prices ravaging their budgets. - Oil buyers from China to India remained cautious as they await details of OPEC's agreement to cut production for the first time since 2008 in order to reduce a global oversupply of crude. SINGAPORE CASH TRADES: Two cash deals reported. For further details, please see FUEL OIL CASH ($/T) ASIA CLOSE Change % Change Prev RIC Close Cargo - 180cst 264.71 11.44 4.52 253.27 FO180-SIN Diff - 180cst 2.06 0.17 8.99 1.89 FO180-SIN-DIF Cargo - 380cst 256.69 10.89 4.43 245.80 FO380-SIN Diff - 380cst 0.09 -0.54 -85.71 0.63 FO380-SIN-DIF Bunker (Ex-wharf)- 380cst 259.69 10.89 4.38 248.80 BK380-B-SIN Bunker (Ex-wharf) Premium 3.00 0.00 0.00 3.00
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