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Asia Fuel Oils HSFO cash premiums of 380 tons drop to the lowest in 3 weeks

Asia’s cash premiums for 380-cst high-sulphur fuel oil (HSFO) slipped for a third straight session on Thursday, while Singapore’s residual fuel inventories were at their lowest level in more than 2-1/2 months.

380-cst HSFO paid 16 cents per tonne in Singapore quotes, the lowest since Dec. 8 owing to the cash differentials.

Brent was traded at a price of $11.91 a barrel for the 380-cst HSFO barge crack for January on Thursday, followed by $11.75 a barrel on Wednesday.

Meanwhile, the first-month VLSFO crack was down at $17.84 per barrel against Dubai crude during Asian trading hours, the highest since February 2020. It was $16.88 a barrel in the previous session.

On Thursday, the cash differential for Asia’s 0.5% VLSFO was at a $16.66 per tonne premium, according to Singapore estimates, compared with $17.61 per tonne on Wednesday.

INVENTORIES

According to the Enterprise Singapore data, Singapore’s onshore fuel oil stocks fell 6.5% or 1.4 million barrels to 19.6 million barrels, or 2.9 million tonnes.

Weekly fuel oil inventories have averaged $22.5 million barrels to date this year, with average of 23.8 million barrels per week last year, according to Reuters, whereas onshore fuel oil inventories are 10.9% lower compared with year-ago levels.

QUOTAS FOR CHINA CRUDE

– According to industry sources and a document reviewed by Reuters, China has produced its first batch of 2022 crude oil import quotas, at a volume 11% below 2021’s first allotment, with large private companies winning out over small processors.

The country’s top three private refineries — Zhejiang Petrochemical Corp (ZPC), Hengli Petrochemical, and Shenghong Petrochemical — together received 41.95 million tonnes compared to 78 percent of the total and nearly 50 percent more than one year earlier.

WINDOW TRADES

Two VLSFO transactions, one 380-cst HSFO trade, are in the works.
Source: Reuters

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