Spot premiums for fuel oil fell further on Monday, while market backwardation narrowed at the prompt months for both high sulphur fuel oil (HSFO) and very low sulphur fuel oil (VLSFO).
Cargo trade remained broadly thin, while softer offers emerged in the spot market and pressured premiums down. Bearish feedstock demand from China and lacklustre bunker demand at Singapore have been capping cargo benchmarks in recent sessions.
Backwardation for 380-cst HSFO held onto its recent strength, staying above $15 per metric ton for the March/April contract, though showing some signs of easing. Meanwhile, the March/April backwardation for VLSFO narrowed below $5 per ton.
Refining cracks for 380-cst HSFO (FO380BRTCKMc1) reverted back to discounted territory since last week, while VLSFO cracks (LFO05SGBRTCMc1) eased towards premiums near $11.50 a barrel.
BUNKER DATA
Marine fuel sales at the United Arab Emirates’ Fujairah extended gains for a second straight month in January, but edged lower versus the same month last year, latest data showed.
The climb was led by strong sales of 380-cst high-sulphur marine fuel at the port, widening the market share of high-sulphur bunkers further to 29% in January, compared with 26% in December.
