29-03-2017

Asia Fuel Oil-Cash discounts slip, more supplies from Rotterdam loading in April

fUEL

Cash differentials of Singapore 380-cst fuel oil slipped on Tuesday after bullish players failed to lift price differentials beyond the near three-week high in the previous session as ample prompt supplies weigh and sellers compete to clear some inventories. WINDOW TRADES – Five 380-cst fuel oil cargoes traded in the Platts window totalling 100,000 tonnes, with three trades occurring at the front of the window and two at the back end.

– Individual values of the traded cargoes were mixed.

Three floating price trades changed hands at a discount of 25 cents a tonne to Singapore quotes, at the front and back of the window. This compared to two flat price trades at $281 per tonne, each at both ends of the window, which equates to a discount of about $1.20 to $1.40 a tonne to Singapore quotes. – Please refer to for more details.

ARBITRAGE FLOWS
– Two very large crude carriers (VLCCs), Nave Electron and New Energy, were fixed by Vitol to load fuel oil cargoes from Rotterdam on April 16 and April 22, respectively, to Singapore at a chartering cost of about $3.3 to $3.4 million each, according to trade sources.
– One trader said the arbitrage window from Rotterdam to Singapore would “barely break-even” at the current East-West (EW) arbitrage spreads and freight rates.
– The April EW spread – the price difference between FOB Singapore 180-cst high-sulphur fuel oil and FOB Rotterdam barge fuel oil with maximum 3.5 percent sulphur – slipped 25 cents from the previous session to $21.75 a tonne.
– Since the start of the month, the April EW spread has traded in a range between $21 a tonne to $23.50 a tonne.

Source: Reuters 

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