Bunker fuel sales in Singapore rose 7.7% month on month to 3.77 million mt in March, 10.2% lower year on year, according to preliminary data by the Maritime and Port Authority of Singapore April 13, reports SP Global.
About the sales
Sales of both low and higher sulfur fuel oil bunkers in March reversed double-digit declines from the previous month, MPA data also showed, amid steadier demand towards end-March onwards.
According to traders polled by S&P Global Commodity Insights, the rise in March bunker sales was aligned with expectations as freight activity was bound to pick up following the lull in February during the Lunar New Year festive season.
The number of bunker-only calls rose 7.7% on month to 3,020 in March, but a 12.7% decline from the previous year, MPA data showed, while total vessel arrivals rose 13.5% on month to an 11-month high of 7,307 in March.
Sales of the International Maritime Organization-compliant grades, which include 100 CST, 180 CST, 380 CST and 500 CST bunker fuel, gained 4.9% on the month to 2.397 million mt in March, rising for the first time after four consecutive months of decline since October.
LSFO sales accounted for 63.6% of the total, 1.7 percentage points below February and 3.9 percentage points lower on year.
Firm Singapore-delivered marine fuel 0.5%S bunker premiums amid less-than-ample upstream inventories slowed demand during most of March, while a rebound in demand was reportedly seen only around late-March with above-average volumes of prompt inquiries, local traders said.
LSFO
The delivered LSFO bunker spread between Singapore and Zhoushan narrowed from an average of $6.56/mt in February to minus 48 cents/mt in March, S&P Global data showed, as prices at the North Asia bunker hub grew less competitive owing to tighter cargo availabilities.
Sales of high sulfur bunker fuel, which includes 180 CST, 380 CST and 500 CST bunker fuel, climbed 17.7% to 1.088 million mt in March, according to MPA data.
HSFO
Gains in HSFO sales have beaten traders’ estimates, as surging prices of the delivered grade had led some buyers to minimize spot requirements at the port of Singapore.
“HSFO spot demand in March was choppy and fluctuates widely… However, vessels would still need to meet requirements,” a Singapore-based bunker supplier said.
Yet, the outlook for April HSFO bunker sales remained bleak amid the recent fuel oil contamination issues detected since March, which market sources said have led buyers to divert demand to other Asian ports, such as Hong Kong and South Korea.
Sales of low sulfur marine gasoil — which has a maximum sulfur content of 0.1% — slipped 3.1% on month and 14.8% on year to 271,800 mt in March.
Strengthening premiums
Strengthening premiums of the gasoil complex and the price volatility have subdued demand for the delivered grade, traders said, though some suppliers have reportedly not faced any loading issues with adequate LSMGO ex-wharf parcels for downstream supply.
Springtime refinery turnaround season in South Korea has tightened regional supply of the light distillate complex since March, and is expected to normalize as refineries are likely to restart operations around mid-April onwards, market sources said.
Premiums of Singapore-delivered low sulfur marine gasoil, with a sulfur content of 0.1%, differential against the benchmark FOB Singapore 10 ppm sulfur gasoil assessments averaged $12.24/mt in March, above the $8.61/mt in February, S&P Global data showed. The premium rose to average $34.32/mt April 1-12, the data also showed.
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Source: SP Global
