Fuel oil cash premiums dropped further in Asia on Wednesday as more competitive offers emerged for October-loading product.
Premium for 0.5% very low sulphur fuel oil MFO05-SIN-DIF slipped to $1.68 a metric ton amid multiple selling interest in the window, while expectations of higher incoming supplies also weighed on the market.
Meanwhile, the October crack for 0.5% VLSFO LFO05SGDUBCMc1 was steady at a premium of $8.26 a barrel at 0830 GMT, based on LSEG Oil Research data.
High sulphur fuel oil continued to soften as seasonal demand from the Middle East is expected to retreat after summer.
The 380-cst HSFO premium FO380-SIN-DIF fell to $9.99 a metric ton, while October crack FO380DUBCKMc1 eased to a discount of $9.82 a barrel.
However, the slide in HSFO cracks is likely to be tempered by Saudi Arabia’s announcement of extended voluntary crude production into the fourth quarter, said consultancy FGE.
Fuel oil inventories at Fujairah rose 6% to 9.09 million barrels (1.43 million tons) in the week to Sept. 11, showed Fujairah Oil Industry Zone data published by S&P Global Commodity Insights.
– Oil rose on Wednesday, firming its ground near a 10-month peak reached during trading a day earlier, as the market balanced supply concerns over Libya output and OPEC+ cuts with global macroeconomic headwinds.
– OPEC stuck to its forecasts for robust growth in global oil demand in 2023 and 2024, citing signs that major economies are faring better than expected despite headwinds such as high interest rates and elevated inflation.
– Oman’s new Duqm oil refinery shipped out its first diesel cargo on Tuesday amid trial runs at the complex, the latest facility in the Middle East to commence operations, according to several trade sources and shiptracking data.
– Four major oil ports in Libya have reopened after shutting down on Saturday because of the powerful storm that swept the country, killing thousands of people, port agent Al Omran International Maritime Agencies said on Wednesday.
WINDOW TRADES O/AS
– 180-cst HSFO: No trade
– 380-cst HSFO: One trade
– 0.5% VLSFO: Two trades
Source: Reuters (Reporting by Jeslyn Lerh)