SINGAPORE: Asia’s spot premium for 0.5% very low sulphur fuel oil (VLSFO) climbed to a three-week high on Monday amid stronger bids and trades, while the result of the closely-watched Al Zour tender also emerged.
Gunvor had bought two spot VLSFO cargoes from Shell for December loading at stronger premiums compared to last week.
The spot cash differential gained $4.55 to a premium of $11.91 per tonne to Singapore quotes on Monday.
Meanwhile, the high sulphur fuel oil (HSFO) market was little changed amid thin trade. The spot 380-cst cash differential rose 63 cents to a premium of $9.21 per tonne to Singapore quotes.
Kuwait refinery Al Zour has awarded its first low-sulphur fuel oil tender to an oil major, several industry sources said on Monday.
The cargo was sold at a premium of about $17 a tonne to Singapore quotes on a free-on-board basis.
The port of discharge was not immediately clear, though industry sources said that the cargo is either headed to Asia or the United States Gulf Coast.
The refinery had offered 100,000 tonnes of the product for loading between Nov 28 to 29, in a tender that closed on Nov 18. Oil prices dropped to near two-month lows on Monday, as supply fears receded while concerns over fuel demand from China and US dollar strength weighed on prices.
China’s exports of very-low-sulphur fuel oil in October fell to its lowest in the year so far, data from the General Administration of Customs showed. European traders are rushing to fill tanks in the region with Russian diesel before an EU ban begins in February, as alternative sources remain limited.
QatarEnergy has signed a 27-year deal to supply China’s Sinopec with liquefied natural gas (LNG), the longest such LNG agreement so far as volatile markets drive buyers to seek long-term deals.