SINGAPORE: The spot cash premium for very low sulphur fuel oil (VLSFO) in Asia fell for a third consecutive session as more supplies are set to hit the East in the coming weeks.
Kuwait’s Al Zour has offered 120,000 tonnes of 0.5% VLSFO for loading between March 7 and 8, in a tender that closes Tuesday.
Total fuel oil supplies into Asia are expected to breach 5.5 million tonnes for February, latest assessments by Refinitiv Oil Research showed on Tuesday. This compared higher from January, led by an uptick in both Western and Middle Eastern supplies. The 0.5% VLSFO cash differential declined to a premium of $17 a tonne on Tuesday, nearing a four-week low. The market’s front-month refining margin also fell at the Asia close (0830 GMT) on Tuesday, at a premium of $11.64 a barrel.
Oil prices fell on Tuesday after the US government said it would release more crude from its Strategic Petroleum Reserve (SPR) as mandated by lawmakers, defying expectations from some traders that the release could be cancelled or delayed.
The Biden administration said it is selling 26 million barrels of crude oil from the Strategic Petroleum Reserve, a release that had been mandated by Congress in previous years. Venezuela will contract with an Iranian shipyard to build two oil tankers under an existing construction agreement bedeviled by payment delays and difficulties with needed certifications, according to people familiar with the matter and documents.
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