Residual Fuels in Asia: Key Market Indicators for July 4-8
Singaporean marine fuel oil supply of 0.5%S was not expected to increase significantly during July 4-8 although the gasoil cracking prevalence in Singapore decreased by 10ppm, with gasoil crack prevalence still higher than for for marine fuels at 0.5% S, which maintains the flow of cut-off shares in the gas oil market, market sources said.
In contrast, high-sulfur fuel oil supplies are expected to remain plentiful due to increased freight flows to Asia, the sources said.
Crude oil futures started the week higher in mid-morning trading in Asia on July 4, with ICE Brent crude for September at $111.27 a barrel at 11 a.m. Singapore time (0300 GMT), up from $109.47 a barrel at 0830 GMT. GMT Asian market close on July 1st. .
Marine fuel 0.5% S
**Singapore marine fuel shipments cash differential 0.5% versus Platts average, Singapore swap values fell to $75.75 per metric ton on July 1 from an all-time high of $78.58 per metric ton on June 27, according to S&P Global data. Commodity Insights, while traders said tight supply was expected to continue to support the market.
** Market sources said there is not enough marine fuel oil in the market to meet demand amid rising gas oil values, with blending components being taken up by the gas oil market and little left for 0.5% grade S marine fuels. Gas oil cracking has shrunk Singaporean to Dubai crude to $54.95 per barrel on July 1 from an all-time high of $71.72 per barrel on June 24, but still well above the crack spread for marine fuels 0.5% S at $32.28 per barrel, Standard & Poor’s. Global data showed.
** In the downstream fuel market, demand in Singapore shows no sign of abating amid tight core supply and steady demand.
**While the price of the vault in Singapore was $15/MT higher than that in Zhoushan after flipping to a premium on June 22nd, higher freight rates gave owners the option to bypass the Chinese port, where the vault is cheaper, when flight optimization is a matter Essential.
** Ex-July contracts settled on quays were heard at $90 per metric ton from June 27 to July 1, up from the mid-1980s per metric ton the previous week. However, the scarcity of supply and rising prices have led to contracting volumes shrinking as suppliers adopt a cautious approach.
** Marine fuel supply of 0.5% S at the Middle East port of Fujairah fell slightly after resuming operations at the Uniper refinery, with a lead time of up to seven days heard for some suppliers, although the majority are still offering 10 days ahead.
**Chinese traders expect major state-owned oil companies to offer a more competitive offer in the Zhoushan-delivery marine fuel market at 0.5% with increased availability of locally produced cargo, although other suppliers report less-than-abundant stocks of spot marine fuel In early July. deliveries.
**Fuel suppliers in Hong Kong are likely to see demand for July contractual ex-harbor marine fuel rise 0.5% amid expectations of higher stocks, as limited stocks raised July terms of ex-berth marine fuel by 0.5% S bunker, sources said. Premiums have also reduced the demand for the grade delivered.
** Marine fuel stocks 0.5% S prompted most South Korean refiners to offer more competitive bids in the downstream delivery market, while strong fuel demand was expected to continue, as suppliers were reported to have largely sold off early July shipments.
High sulfur fuel oil
** Sources said supplies in the high-sulfur bunker fuel market in Singapore are likely to remain plentiful from July 4-8 due to increased supplies in Asia.
** Fujairah has emerged as a major importer of Russian fuel oil in recent months, with shipments of fuel from Russia to Fujairah reaching a record 527,000 metric tons (116,000 barrels per day) in June, according to preliminary estimates from the data intelligence firm. Kpler, up from 403,00 tons in May and 482,000 tons in April.
**Demand for HSFO fuel in Singapore remains tepid with few inquiries reported, and prices for HSFO delivered are likely to remain limited due to abundant availability.
** Demand for HSFO fuel in South Korea for delivery in early July is expected to increase compared to the same period in June, while barge availability remains healthy, dealers said.
** Premiums for 380 CST HSFO warehouses being delivered in Japan are likely to remain limited amid ample stocks, despite increased demand for both spot and fixed contract designations since July, according to local fuel suppliers.
** Demand for HSFO in Hong Kong is likely to remain flat for fuel deliveries in early July, while local suppliers anticipate a glut on premium fuel deliveries, market sources said.