Fuel oil markets were largely stable in Asia on Monday against a backdrop of thin trading momentum, while spot tender discussions have also quietened.
Intermonth spreads for high sulphur fuel oil (HSFO) traded at a narrower backwardation for the prompt months, while 380-cst cracks eased slightly but remained in premiums.
The market remains well-supplied due to a heavy supply influx from last month, which has capped recovery in benchmarks, though industry sources expect some strength to emerge due to seasonal summer demand.
Meanwhile, the very low sulphur fuel oil (VLSFO) market was broadly unchanged on Monday.
The outlook remains cautious ahead of the new Mediterranean emission control area regulation, which comes into place starting from May and will impact bunker trading dynamics.
REFINERY UPDATES
– U.S. crude oil refiner Phillips 66 plans to operate its refineries in the mid-90% range of combined capacity of 1.5 million barrels per day in the second quarter.
OTHER NEWS
– Oil prices were stable on Monday as investors weighed up uncertainty over trade talks between the U.S. and China, clouding the outlook for global growth and fuel demand, as well as the prospect of OPEC+ raising supply.
– The world’s biggest oil exporter Saudi Arabia may slightly increase its crude prices for Asian buyers in June for the first time in three months, tracking gains in benchmark prices this month, refiners said on Monday.
– South Korea’s S-Oil, majority owned by Saudi Aramco, posted losses in the first quarter from its refining and petrochemical units and expects second-quarter margins to be impacted by U.S. tariff negotiations and market volatility.
– Estonia has released the oil tanker Kiwala, which is on an EU sanctions list, having detained it for sailing without a valid country flag.
WINDOW TRADES
– 180-cst HSFO: No trade
– 380-cst HSFO: No trade
– 0.5% VLSFO: No trade
Source: Reuters
