SINGAPORE: Asia’s cash premiums for 380-cst high-sulphur fuel oil (HSFO) slipped for a fourth consecutive session on Thursday, while residual fuel inventories in Singapore climbed to a four-week high.
The cash premiums for 380-cst HSFO were at $1.23 per tonne to Singapore quotes, the lowest since Dec. 14. They were at $1.29 per tonne a day earlier.
The 380-cst HSFO barge crack for January traded at a discount of $11.04 a barrel to Brent on Thursday, compared with minus $11.05 a barrel on Wednesday. The crack, however, has gained nearly 20% in the last month, Refinitiv data showed.
Meanwhile, the front-month VLSFO crack surged to $15.64 per barrel against Dubai crude during Asian trading hours, up from $14.99 in the previous session.
Cash differential for Asia’s 0.5% VLSFO was at a premium of $18.91 a tonne to Singapore quotes on Thursday, compared with $19.10 per tonne on Wednesday.
Global oil demand roared back in 2021 as the world began to recover from the coronavirus pandemic, and overall world consumption potentially could hit a new record in 2022 - despite efforts to bring down fossil fuel consumption to mitigate climate change.
Gasoline and diesel use surged this year as consumers resumed travel and business activity picked up. For 2022, crude consumption is expected to reach 99.53 million barrels per day (bpd), up from 96.2 million bpd this year, according to the International Energy Agency. That would be a hair short of 2019’s daily consumption of 99.55 million barrels. Singapore’s onshore fuel oil stocks rose by 6,000 barrels to 20.9 million barrels, or 3.1 million tonnes, in the week to Dec. 22, according to the Enterprise Singapore data.
Weekly fuel oil inventories have averaged 22.5 million barrels so far this year, having averaged 23.8 million barrels a week last year, Reuters calculations showed. Onshore fuel oil inventories were 2.7% higher, compared with year-ago levels. One 380-cst HSFO trade, two VLSFO deals.
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