SINGAPORE: Asia’s 0.5% very low-sulphur fuel oil (VLSFO) front-month crack extended losses on Tuesday, falling for a fourth straight session, as crude oil prices rose.

The front-month VLSFO crack slipped to a near two-month low of $11.27 a barrel above Dubai crude, down from $12.10 at the start of the previous week, Refinitiv data on eikon showed.

This came as benchmark oil prices extended gains on Tuesday during Asian trading hours as investors bet tight supply and rising vaccination rates will help offset any impact on demand from surging COVID-19 cases worldwide.

Front-month Brent crude futures has rallied to about $75 a barrel on Tuesday from around $68 at the start of last week.

Despite the lower crack values, the near term VLSFO market’s supply outlook remains somewhere between tight to balanced, trade sources said.

Three high-sulphur fuel oil (HSFO) cargo trades were reported in the Singapore window totalling 60,000 tonnes.