SINGAPORE: Asia’s 0.5% very low-sulphur fuel oil (VLSFO) market complex was broadly lower on Monday amid limited trade activity.

Still, hopes of improved spot bunker demand in the world’s top bunkering hub may help lift market sentiment, as bunkering restrictions in China may divert refuelling calls to Singapore, trade sources said.

The prompt-month VLSFO time spread fell 25 cents to minus 75 a tonne on Monday while firmer crude oil prices helped push the July crack 18 cents lower to $12.55 a barrel against Dubai crude, Refinitiv data in Eikon showed.

No 0.5% VLSFO or high-sulphur fuel oil (HSFO) cargo trades were reported in the Singapore trading window.

Overall floating storage inventories in the Malacca Strait slipped 5% in the week ended June 2, weighed down by a slump in stocks of fuel oil with an unspecified sulphur content, according to data intelligence firm Kpler.

Total floating storage inventories fell 159,000 tonnes to a two-week low of 3.16 million tonnes, the data showed. The floating inventories were last higher in the week to May 19 at 3.1 million tonnes, the data showed.

Floating inventories of IMO-compliant VLSFO rose by 7% to 1.99 million tonnes in the week ended June 2, the Kpler data showed.

Stocks of HSFO were virtually unchanged at 561,000 tonnes while stocks of residual fuels with unspecified sulphur contents dropped by 280,000 tonnes, or 31%, from last week to 614,000 tonnes, the data showed.

Global commodities trader Trafigura and Norway’s Yara said on Monday they had signed a memorandum of understanding (MoU) aiming to supply the marine industry with carbon emissions-free ammonia for fuel.

Under the plan, Yara is to supply Trafigura with clean ammonia, and the firms are to jointly conduct research as well as develop marine fuel infrastructure and market opportunities for both “green” and “blue” ammonia, the companies said.