SINGAPORE: Asia’s spot fuel oil market eased on Monday after a fresh tender from Kuwait’s Al Zour emerged, trade sources said.
The cash differential for 0.5% very low sulphur fuel oil (VLSFO) slipped to $23.75 a tonne, with spot offers trending lower from the previous week.
Earlier talks of potential supply tightness in February have retreated. Kuwait’s Al Zour has offered 120,000 tonnes of fuel oil for loading between Feb. 17 and 18. The tender closes on Jan. 31, sources said. Meanwhile, the 380-cst high sulphur fuel oil (HSFO) market also softened, with its cash differential easing to $1.75 a tonne.
Cracks for both VLSFO and HSFO also declined on Monday, despite lower crude oil prices during Asia trading hours.
Oil prices fell on Monday amid looming interest rate hikes by major central banks and signs of strong Russian exports, which offset rising Middle East tension over a drone attack in Iran and hopes of higher Chinese demand.
Saudi Arabia may trim prices for crude grades sold to Asia for a fourth consecutive month in March amid low physical oil premiums, as oversupply worries linger despite expectations of demand recovery in China.
India plans to use an emergency law next month to force power plants that run on imported coal to maximise output, two government sources told Reuters on Monday, in preparation for expected record consumption this summer.
Venezuela’s state oil firm PDVSA is toughening terms for buyers after a month-long halt to most exports of crude and fuel, demanding prepayment ahead of loadings in either cash, goods or services, company documents showed.
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