SINGAPORE: Asia’s front-month crack for 0.5% very low-sulphur fuel oil (VLSFO) rose on Monday, buoyed by tighter regional supplies.
The front-month VLSFO crack climbed to $15.39 per barrel against Dubai crude during Asian trading hours, compared with $15.28 per barrel on Friday.
Cash premiums for Asia’s 0.5% VLSFO, however, dipped to $16.66 a tonne to Singapore quotes, down from $17 per tonne at the end of last week.
Meanwhile, Asia’s cash differentials for 380-cst high sulphur fuel oil (HSFO) were at a premium of $2.26 per tonne to Singapore quotes on Monday, compared with $2.55 a tonne in the previous session.
Asia’s gasoil refining profit is on track to jump around 30% this year and expected to climb further in 2022, as the regional market shrugs off the worst of the COVID-19 pandemic with India and China driving demand.
The rapidly spreading Omicron coronavirus variant has led some countries to reimpose lockdown measures, but traders and analysts expect overall fuel demand to continue recovering, albeit more slowly than expected earlier.
One VLSFO trade, no HSFO deals. Trafigura sold a 40,000-tonne VLSFO cargo to Gunvor at a discount of $2 per tonne to balance December Singapore quotes.
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