SINGAPORE: Singapore fuel oil inventories dropped for a sixth straight week to a more than eight-month low in the week ended July 24, official data released on Thursday showed.

Onshore fuel oil stocks fell by 1.623 million barrels (about 242,000 tonnes) from the previous week to 16.916 million barrels, or 2.525 million tonnes, data from Enterprise Singapore showed.

The shrinking inventories in the Singapore bunkering and trading hub were a result of weeks of persistently low fuel oil arbitrage inflows and as suppliers cleared stockpiles of high-sulphur fuel oil in perpetration for cleaner marine fuel rules starting 2020.

Under International Maritime Organization (IMO) rules that come into effect from 2020, ships will have to use fuel with a sulphur content of 0.5pc or less, compared with current 3.5pc.

Firm marine fuels demand in the Singapore hub also helped eat into supplies of the residual fuel.

Singapore fuel oil stocks hit their lowest since the week ended Nov. 14, 2018.

Net fuel oil imports, in the week ended July 24, were down 42pc from the previous week to a two-week low of 605,000 tonnes and were below the 2019 weekly average of 690,000 tonnes. Such weekly figures, however, are volatile.

Compared with year-ago levels, this week's onshore fuel oil inventories were 4pc higher.

Singapore's net exports of fuel oil to Bangladesh topped the week ended July 24 at 117,000 tonnes, a near two-year high, followed by China at 100,000 tonnes, Hong Kong at 77,000 tonnes and Cambodia at 6,000 tonnes.

The largest net imports into Singapore originated from the United Arab Emirates (UAE) at 362,000 tonnes, followed by Lithuania at 208,000 tonnes, Iraq at 96,000 tonnes and Russia at 85,000 tonnes.

Singapore fuel oil imports from Lithuania were at their highest in more than 3-1/2 years, or as far as available records go back, while those from the UAE climbed to a six-week high in the week ended July 24.

Copyright Reuters, 2019