SINGAPORE: Asia’s 0.5% very low-sulphur fuel oil (VLSFO) cash premium jumped to a one-week high on Monday amid firm deal values for cargoes of the fuel in the Singapore window.
The cash premium rose to $12.90 a tonne to Singapore quotes, up from $10.45 a tonne in the previous session. Meanwhile, the VLSFO crack held largely steady at $15.92 a barrel above Dubai crude, slightly down from $16.09 on Friday, Refinitiv data in Eikon showed, even as crude prices firmed.
Oil rose more than 1% on Monday to near 7-year highs hit in the previous session, while supply concerns and political tensions in Eastern Europe and the Middle East put prices on track for their biggest monthly gain in almost a year.
Two VLSFO cargo trades were reported in the window totalling 60,000 tonnes along with one 20,000-tonne 180-cst high-sulphur fuel oil (HSFO) cargo deal.
Overall floating storage inventories for residual fuel in the Malacca Strait slipped to a two-week low of 2.29 million tonnes in the week ended Jan. 26 as a drop in HSFO supplies weighed, according to data intelligence firm Kpler.
The floating inventories were down by 32,000 tonnes, or 1%, from the previous week, Kpler data showed.
Floating stocks of HSFO dropped by 299,000 tonnes, or 58%, to 220,000 tonnes, in the week to Jan. 26, the data showed.
By contrast, floating VLSFO inventories climbed to 1.8 million tonnes, up by 13%, or 206,000 tonnes, from the previous week, while stocks of residual fuels with unspecified sulphur content climbed 29%, or 61,000 tonnes, to 270,000 tonnes.
Singapore onshore inventories jumped 12% in the week ended Jan. 26, rising to a near five-month high of 23.78 million barrels or 3.75 million tonnes, as net import volumes surged.
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