SINGAPORE: Asia's 0.5% very low-sulphur fuel oil (VLSFO) crack and cash premium fell on Monday but sentiment remained bullish amid tight supplies and expectations of firming demand from north Asian utilities. The front-month VLSFO crack fell to a 10-session low of $13.24 a barrel above Dubai crude, down from $13.52 on Friday, Refinitiv data in Eikon showed.
This came despite weaker crude oil prices on Monday which fell on expectations of increasing supply, while higher energy costs and rising COVID-19 cases are also seen weighing on demand.
Similarly, a weaker deal value in the Singapore trading window dragged the VLSFO cash differential to $6 a tonne above Singapore quotes, down from a near two-year high of $8 a tonne on Friday.
Chevron bought a 20,000 tonne 0.5% very low-sulphur fuel oil (VLSFO) cargo from Trafigura at a $6 per tonne premium. By comparison, VLSFO cargoes last traded at $8 per tonne premiums on Friday. No high-sulphur fuel oil (HSFO) cargo trades were reported in the Singapore trading window.
Marine fuel sales in Singapore jumped to a six-month high of 4.26 million tonnes in October, recovering from a 15-month low in September as average loadings at the world's largest bunkering hub for jumped to near four-year highs, the latest official data showed.
The October volumes were up 2% from last year and 8% higher from September, data from the Maritime and Port Authority of Singapore (MPA) showed. Vessel arrivals at the Singapore hub for bunkers jumped to 3,165 in October, up from a near four-year low of 3,098 in September, the MPA data showed.
Vessels loaded an average of 1,344 tonnes each of bunkers in October, up from an average of 1,270 tonnes in September and the largest volumes since November 2017, Reuters calculations showed.
Overall floating storage inventories for residual fuel in the Malacca Strait slipped to a two-week low in the week ended Nov. 10, dragged by a drop in stocks of residual fuels with unspecified sulphur contents, according to data intelligence firm Kpler.
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