SINGAPORE: Weaker crude oil prices helped the front-month fuel oil crack narrow its discount to Brent crude on Tuesday to a more than one-week high, trade sources said.
Some trade sources also pointed to expectations of improved Asian fuel oil demand following the Lunar New Year holidays in early-February as well as some traders rolling over back-end crack trades to the prompt as other factors helping narrow the fuel oil crack discount.
The February 380-cst barge crack discount against Brent crude was trading as low as minus $5.10 a barrel on Tuesday before retreating to about minus $5.40 a barrel, brokers said.
The front-month crack discount was at minus $5.60 a barrel on Monday and was last narrower on Jan. 9 at minus $5.32 a barrel, Refinitiv data in Eikon showed.
Oil prices fell more than 1 percent on Tuesday on signs that an economic slowdown in China was spreading, stoking concerns about global growth and fuel demand.
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