SINGAPORE: Asia’s front-month crack for 0.5% very low-sulphur fuel oil (VLSFO) climbed on Monday, while cash premiums for the marine fuel grade rose for the first time in five sessions, riding on a firmer deal in the physical market.
The front-month VLSFO crack climbed to $24.81 per barrel against Dubai crude during Asian trading hours, compared with $24.57 per barrel on Friday.
Cash premiums for Asia’s 0.5% VLSFO rose to $23.70 a tonne to Singapore quotes compared with $21.69 per tonne on Friday, while the April/May VLSFO time spread widened its backwardated structure on Monday to trade at $29.75 a tonne.
Asia’s cash premiums for 380-cst high sulphur fuel oil (HSFO) were at $10.09 per tonne to Singapore quotes on Monday, compared with $9.97 per tonne at the end of last week.
China Petroleum & Chemical Corp, better known as Sinopec, is planning its highest capital investment in history for 2022 after recording its best profit in a decade, echoing Beijing’s call for energy companies to raise production.
Sinopec expects to spend 198 billion yuan ($31.10 billion) in 2022, up 18% from a year ago, beating the previous record of 181.7 billion yuan set in 2013, according to a company statement filed to the Shanghai Stocks Exchange on Sunday.
It plans to invest 81.5 billion yuan in upstream exploitation, especially the crude oil bases in Shunbei and Tahe fields, and natural gas fields in Sichuan province and the Inner Mongolia region.
No high-sulphur fuel oil (HSFO) deals, one VLSFO trade.
Oil prices tumbled more than $5 on Monday as fears over weaker fuel demand in China grew after financial hub Shanghai launched a two-stage lockdown to contain a surge in COVID-19 infections.
Oil producers who felt like outcasts at the COP 26 climate conference last year are now being treated like superheroes because their supplies are in strong demand, UAE energy minister Suhail al-Mazrouei said on Monday at an industry event.