Asia’s high sulphur fuel oil (HSFO) market logged a narrower discount on Thursday as stronger bids emerged, though onshore inventories at Singapore storage hub remained high, capping recovery in the benchmarks.
The 380-cst HSFO cash differential rebounded for a second consecutive day to a discount narrower than $7 a metric ton, while ample selling interest limited gains.
As for very low sulphur fuel oil (VLSFO), the product traded unchanged at parity differential to cargo quotes, while bids and offers remained rangebound.
High inventories in Singapore continued to pressure the prompt markets.
Onshore fuel oil stockpiles climbed to a three-week high in Singapore, breaching 25 million barrels. The top supply origin was Russia for the week, official data showed.
Cracks for HSFO and VLSFO extended declines. VLSFO’s crack (LFO05SGBRTCMc1) fell to a premium of about $3.60 a barrel, while 380-cst HSFO’s crack (FO380BRTCKMc1) slipped to a discount near $8.35 a barrel, data compiled by LSEG showed.
INVENTORY DATA
– Singapore residual fuel inventories (STKRS-SIN) rose 3.4% to 25.56 million barrels (about 4.03 million metric tons) in the week to December 3, Enterprise Singapore data showed.
OTHER NEWS
– Oil prices firmed on Thursday after Ukrainian attacks on Russia’s oil infrastructure signalled potential supply constraints, while stalled peace talks tempered expectations of a deal restoring Russian oil flows to global markets.
– Venezuela’s oil exports rose slightly to some 921,000 barrels per day in November, the third-highest monthly average so far this year, as the country used more diluents to produce exportable grades, according to shipping data and documents.
– ExxonMobil plans to wind down from March operations at the older of its two steam crackers on Singapore’s Jurong Island, four sources familiar with the matter said, part of a global petrochemicals sector trend to reduce capacity amid industry losses.
– Chevron said that capital expenditure for 2026 will be between $18 billion and $19 billion as the oil major focuses on production in the U.S. and investments connected to a recently-acquired oil stake in Guyana.
WINDOW TRADES
– 180-cst HSFO: No trade
– 380-cst HSFO: No trade
– 0.5% VLSFO: One trade
Source: Reuters
