Since the start of the year, refining margins of the industrial fuel have been boosted by tighter supplies as well as firm demand which typically rises in the summer months as demand for power generation rises to meet cooling demand.

REFINING MARGINS

- Fuel oil margins have soared across all major regions this year following the extension of OPEC-led cuts which reduced supplies of fuel oil rich medium and heavy crude oil.

- Ongoing investment into upgrading capacity in India and Russia as well as declining production from Venezuela are among other supply-side supportive factors.

- Firm bunker fuel demand coupled with rising demand for power generation during the summer months are also expected to strain near-term supplies.

- Brokers pegged the July barge crack to Brent crude at about minus $5.15 a barrel on Tuesday, up from minus $5.25 a barrel in the previous session.

- "Last year the highest the (barge) cracks got was about minus $6 (a barrel)...I can't remember the last I saw cracks so strong," said one Singapore based fuel oil broker.