SINGAPORE: Asia's fuel oil market firmed on Thursday as concerns over shrinking supplies were supported by data showing fuel oil inventories in key storages fell to multi-month lows.
180-cst high-sulphur fuel oil (HSFO) cash premiums rose to a near two-year high of $9.98 a tonne to Singapore quotes, while 380-cst HSFO cargo premiums held near a 1-1/2 year high hit on Tuesday at $10.11 a tonne.
The front-month 180-cst HSFO crack discount narrowed to $3.07 a tonne below Dubai crude, Refinitiv data in Eikon showed.
The HSFO crack discount was at its narrowest in four months at minus $2.93 a barrel on Tuesday.
Singapore residual fuel oil inventories fell 4% in the week ended Aug. 25 to a six-month low amid persistently weak net import volumes, official data showed on Thursday.
On Wednesday, industry data showed Fujairah fuel oil stocks fall to a five-month low of 8.69 million barrels, or 1.37 million tonnes, in the week ended Aug. 23, down by 44% from the same period last year.
Onshore fuel oil stocks fell by 889,000 barrels, or about 140,000 tonnes, to 21.18 million barrels, or 3.34 million tonnes, their lowest since the week to Feb. 24, Enterprise Singapore data showed.
While Singapore's weekly net fuel oil imports were up by 26% from the previous week to 593,000 tonnes, they were below the 2021 weekly average of 687,000 tonnes for a fifth straight week. Weekly figures, however, are volatile.
Compared with a year earlier, residual fuel stocks were 8% lower and below the 2021 weekly average of 23.13 million barrels.
The largest net imports were from the United Arab Emirates (UAE) at 210,000 tonnes, followed by Malaysia at 207,000 tonnes, Brazil at 96,000 tonnes and Algeria at 74,000 tonnes.
The top net export destinations for Singapore fuel oil were the Philippines at 44,000 tonnes, followed by South Korea at 38,000 tonnes and New Caledonia at 37,000 tonnes.
Fuel oil flows into east Asia, most of which come to Singapore, for August are expected to total between 5 million tonnes to 5.5 million tonnes with 5.2 million tonnes assessed so far, according to Refinitiv Oil Research.
"We expect August arrivals to decline on-month from July's 5.73 million tonnes, led by a loss of momentum in fuel oil feedstock buying from China and, to a lesser extent, by India and South Korea," Refinitiv Oil Research said.
No 0.5% very low-sulphur fuel oil (VLSFO) or high-sulphur fuel oil (HSFO) cargo trades were reported in the Singapore trading window.
Indonesia's navy is preparing to charge the captain of a ship accused of loading oil illegally in Cambodia and anchoring in Indonesian waters without permission, according to local authorities and the vessel owner.
Bahamas-flagged tanker MT Strovolos was stopped in waters near the Anambas islands of Indonesia on July 27, the Indonesian Navy said in a statement. The stop followed a red notice issued by the Cambodian embassy on July 24 that asked Indonesian authorities to make an arrest on suspicion of stealing around 300,000 barrels of Cambodian crude, the Navy said.