SINGAPORE: Asia’s 0.5% very low-sulphur fuel oil (VLSFO) front-month crack slipped on Monday, giving up some of the sharp gains since the end of January.
The front-month crack slipped to $18.95 a barrel above Dubai crude, down from $19.13 on Friday which was the highest since Feb. 6, 2020, Refinitiv Eikon data showed.
Worries over tight supplies propelled the VLSFO crack from $14.21 a barrel on Jan. 26 to a two-year high on Friday, the Refinitiv data showed.
This came as benchmark oil prices fell $1 on Monday as signs of a progress in the US-Iran nuclear talks that could lead to removal of US sanctions on Iranian oil sales offset concerns about the tight supplies.
One VLSFO cargo trade was reported in the window totalling 20,000 tonnes along with two 380-cst high-sulphur fuel oil (HSFO) cargoes totalling 40,000 tonnes.
Kuwait’s KPC sold 80,000 tonnes of 380-cst heavy HSFO with a maximum 4% sulphur content loading over Feb. 8-naphtha 9 to an unknown buyer.
Overall floating storage inventories for residual fuel in the Malacca Strait dipped to a two-week low of 2.36 million tonnes in the week ended Feb. 2, according to data intelligence firm Kpler.
The floating inventories were down by 98,000 tonnes, or 4%, from the previous week, Kpler data showed.
Floating VLSFO inventories fell to 1.87 million tonnes, down by 5%, or 97,000 tonnes, from the previous week, while stocks of residual fuels with unspecified sulphur content dropped 23%, or 64,000 tonnes, to 210,000 tonnes.
Floating stocks of HSFO, however, rose by 63,000 tonnes, or 29%, to 283,000 tonnes, in the week to Feb. 2, the data showed.
Singapore onshore inventories fell 3% to a two-week low of 23.09 million barrels or 3.64 million tonnes, in the week ended Feb. 2 as net import volumes dropped.
Tanker and barge shipments in and out of Europe’s biggest oil hub have been delayed by up to a week as four storage companies scramble to resume operations after cyber attacks, sources familiar with the matter said.
Since the end of last week, storage company Oiltanking and oil trading firm Mabanaft, both owned by Germany’s Marquard & Bahls, have been hit by hackers. Belgium’s SEA-TANK and Dutch fuel storage firm Evos have also been affected.
The companies have had to suspend some operations, affecting oil flows in the Netherlands, Belgium and across Germany. It is not clear whether the cyber attacks are linked.