Asia Fuel Oil-Falling inventories boosts time spreads


Prompt month time spreads of 380-cst fuel oil soared on Friday, boosted by falling fuel oil inventories in Northwest Europe and Singapore.

– Fuel oil stocks in independently held storage in the Amsterdam-Rotterdam-Antwerp hub fell by over a quarter in the week to Thursday as shipments of the fuel went to Singapore, data from Dutch consultancy PJK International showed.

– Stocks were down 25.3 percent at 1.15 million tonnes, after hitting an all-time high last week, as two very large crude carriers and a Suezmax carrying the fuel left the hub for Singapore in the past week, PJK’s Patrick Kulsen said.

– This follows Thursday’s data showing Singapore inventories of the fuel fell for a second consecutive week, dropping 7 percent, from the previous week to 3.52 million tonnes in the week to April 5, the latest official data showed.

– Buying interest lifted the ICE-traded 380-cst balance-of-April/May time spread to a premium of about 80 cents per tonne by 1630 Singapore time (0830 GMT), up about 20 cents a tonne from the same time in the previous session.

– Reflecting improved sentiment, the 380-cst April/May time spread was sharply higher from the same time last week when it was trading at a discount of 40 cents a tonne.

– Ten 380-cst fuel oil cargoes traded in the Platts window on Friday totalling 200,000 tonnes of 380-cst fuel oil.

– A total of 1.26 million tonnes of 380-cst fuel oil have already traded in the window since the start of April.

– Mexico’s state-owned Federal Electricity Commission is seeking up to 4.4 million barrels of HSFO through two tenders.

The first import tender is for sixteen parcels of 250,000 barrels each for delivery between April and August to the port of Tuxpan in the state of Veracruz. The tender closes on April 17.

The second tender calls for two 200,000-barrel cargoes of 170-cst HSFO for delivery on April 11-13 and May 9-11 at the port of Progreso in Yucatan. The tender closed on April 3.

– India’s Reliance sold 40,000 tonnes of carbon black feedstock to Vitol for loading between April 22-23 at port Sikka. The pricing of the cargo was unknown.

– Asia’s diesel margin is expected to fall in coming weeks as it faces a slowdown in import demand from China ahead of a tax clampdown and from Australia after a cyclone hit mining activity.

 FUEL OIL                                                                         
 CASH ($/T)             ASIA CLOSE    Change   %       Prev       RIC
                                               Change  Close      
 Cargo - 180cst               321.11     9.15    2.93     311.96  FO180-SIN
 Diff - 180cst                  0.11     0.00    0.00       0.11  FO180-SIN-DIF
 Cargo - 380cst               316.74     9.48    3.09     307.26  FO380-SIN
 Diff - 380cst                  1.55     0.05    3.33       1.50  FO380-SIN-DIF
 Bunker (Ex-wharf)-           318.00    16.50    5.47     301.50  BK380-B-SIN
 Bunker (Ex-wharf)              1.26                        5.76                  

Source: Reuters

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