Spot premiums for high sulphur fuel oil (HSFO) retreated further on Tuesday, while more supplies continued to be eyed for the near term.
Total fuel oil arrivals in Asia are expected to breach 7 million tons this month, up from about 4.5 million tons to 5 million tons last month, calculations based on ship-tracking data showed.
The influx was led by an uptick in arrivals across all key supplying regions.
Cash premium for 380-cst HSFO extended declines in recent sessions as offers softened for April loading dates. The market has retained strength largely for the March trading cycle, despite more supplies expected.
Demand has also been soft for the product, with purchases slowing from the Chinese refining sector, while demand from the Asia bunkering sector has also been largely tepid.
Meanwhile, the market for very low sulphur fuel oil (VLSFO) held largely unchanged amid limited fresh drivers, with spot differentials holding in discounts.
VLSFO cracks for April (LFO05SGBRTCMc1) closed near $7.60 a barrel, down from the previous day, while 380-cst HSFO cracks closed at discounts near $2.45 a barrel.
In tenders, India’s HPCL offered HSFO for loading in April.
REFINERY UPDATES
U.S. oil refiners are expected to have about 1.1 million barrels per day of capacity offline in the week ending March 21, decreasing available refining capacity by 409,000 bpd, research company IIR Energy said on Monday.
