SINGAPORE: Asia’s 0.5% very low-sulphur fuel oil (VLSFO) extended gains to a one-month high on Friday after one cargo trade was reported in the window, but rising crude oil prices helped push the VLSFO crack lower.
The VLSFO cash discount narrowed to minus 90 cents a tonne to Singapore quotes, up from minus $1.06 in the previous session and minus $2.75 last week.
But as prices edged closer to two-year highs on Friday, the front-month VLSFO crack to Dubai crude slipped to $12.72 a barrel. Still, the crack was higher compared with the $10.49 a barrel margin at the start of the week.
Meanwhile, residual fuel inventories across all three Amsterdam-Rotterdam-Antwerp (ARA), Singapore and Fujairah oil trading and storage hubs rose sharply over the past week, the latest official data showed.
Fuel oil stocks in the ARA refining and storage rose by 154,000 tonnes, or 13%, to 1.374 million tonnes in the week ended June 3, data from Dutch consultancy Insights Global showed.
Compared with last year, however, the inventories at the ARA hub were 19% lower but were above the five-year seasonal average of 1.208 million tonnes.
In Singapore, fuel oil inventories were 12% higher to a three-week high of 25.59 million barrels, or 4.03 million tonnes, snapping three consecutive weeks of declines.
In the Fujairah hub, fuel oil stockpiles jumped 23% higher to a four-week high of 14.65 million barrels, or 2.31 million tonnes, in the week to May 31 amid higher net imports.
P66 bought a 20,000-tonne VLSFO cargo from Trafigura in the Singapore trading window at a 50 cent per tonne discount to Singapore quotes.
A similar VLSFO cargo trade last traded in the window on May 24 at a $3 per tonne discount.
No high-sulphur fuel oil (HSFO) cargo trades were reported.
Maersk Tankers Singapore Pte Ltd and Scorpio LR2 Pool Ltd have filed separate claims in the Singapore High Court against Winson Oil Trading Pte Ltd for failing to fulfil its contractual obligations, court documents show.
A spokesman for Winson Oil Trading said it “intends to vigorously defend” and “have every confidence in the outcome” of both cases but will not make any further comments until the court has issued its decision.
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