Morning discussions for the ICE October Brent futures contract showed it was trading at $68.97/b at 0245 GMT Aug. 10.- Down from the $71.78/b level at 0830 GMT Aug. 6, Intercontinental Exchange data showed.
A recent news report published in the Platts website by Rohan Menon reveals about Asia residual fuels and key market indicators for Aug. 10-13.
0.5%S marine fuel
** Discussions for the Singapore Marine Fuel 0.5%S September/October spread showed that it narrowed slightly Aug. 10 from the Aug. 6 assessment, with bids at $2/mt against offers at $2.75/mt, according to Intercontinental Exchange data.
** In the north Asian market, August supply of Zhoushan ex-wharf 0.5%S marine fuel was heard concluded between differentials of minus $2/mt and plus $2/mt against Singapore Marine Fuel 0.5%S cargo assessments, industry sources said.
** Traders said an oversupply of the IMO-compliant bunker fuel from coastal refineries is weighing on ex-wharf premiums and valuations of the delivered grade, despite steady bunker demand in the downstream delivered market.
** SK Energy and S-Oil were making determined offers for South Korea-delivered marine fuel 0.5%S bunker, which could weigh on premiums in the near term, industry sources in South Korea said.
** Meantime, Hyundai Oilbank and GS Caltex have mostly stayed on the sidelines since Aug. 5 as both refiners have committed inventories of 0.5%S marine fuel for August deliveries, sources said.
** On Aug. 6, the premiums of South Korea-delivered marine fuel 0.5%S bunker averaged $13.87/mt above the Singapore Marine Fuel 0.5%S cargo assessments during the first trading week of the month, down $8/mt from July’s average, S&P Global Platts data showed.
** Traders said Typhoon Mirinae is due to make landfall at Tokyo Bay between Aug. 7 and Aug. 8 to hamper bunkering operations, which could dilute bunker demand over the next few days.
** The weather event in Japan is not expected to subdue prices of delivered bunker fuels because supplies of both the IMO-compliant and high sulfur fuel oil bunkers were balanced against demand for both the grades, industry sources said.
High sulfur fuel oil
** Discussions for the Singapore 380 CST high sulfur fuel oil September/October spread were stable Aug. 10 from the Aug. 6 assessment of $5.75, according to Intercontinental Exchange data. Bids for the spread stood at $5.50/mt against offers at $6/mt.
** The Singapore 180 CST high sulfur fuel oil market is expected to stay strong as HSFO became a more economical option than LNG for power plants.
** The Asian HSFO market typically sees a surge in demand during June-August, while the high LNG price was another factor increasing HSFO demand, market sources said. Asian LNG has soared due to strong demand from north Asia and higher prices in Europe.
** The Platts JKM was assessed at $17.295/MMBtu for September delivery on Aug. 6, while FOB Singapore 180 CST HSFO was assessed at $419.01/mt, which was about $11/MMBtu. Pakistan and Kuwait are the countries actively buying HSFO, market sources said.
** In the Middle East, term premiums of Singapore ex-wharf 380 CST HSFO were offered at $2-$3/mt over the FOB Singapore 380 CST HSFO cargo assessments, down from premiums of around $3.50/mt concluded in July for August supply.
** Stocks of heavy distillates at the UAE’s Port of Fujairah, which include fuel for power generation and marine bunkers, tumbled 9.6% on the week to reach a four-month low of 10.138 million barrels as of Aug. 2, Fujairah Oil Industry Zone data showed.
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Source: Platts
