Spot discounts for high sulphur fuel oil (HSFO) narrowed at the end of the week, with trading momentum retaining a somewhat robust pace for the 380-cst grade.

Several trades emerged at rangebound levels for dates in early to mid-December, though a higher-priced trade emerged for dates into later December, lifting the cash differential higher.

Meanwhile, the very low sulphur fuel oil (VLSFO) market was broadly unchanged, with cash differential stuck in a small premium.

Reflecting the slight recovery in HSFO, the Asia hi-5 fuel oil spread crunched for a third consecutive day.

The hi-5, which reflects VLSFO’s premium over the price of 380-cst HSFO, closed lower at about $80 a metric ton, based on prompt-month data compiled by LSEG. (FO05-380SGMc1)

As for margins, HSFO edged higher but VLSFO continued to stay under pressure despite a decline in crude prices on Friday.

The product crack for VLSFO (LFO05SGBRTCMc1) fell to a premium of around $5.40 a barrel, while 380-cst HSFO crack (FO380BRTCKMc1) closed higher at a discount nearer to $7 a barrel in volatile trading.

In tenders, Malaysia’s PrefChem offered 540,000 barrels of atmospheric residue for loading in late November, closing on Monday, market sources said.

INVENTORY DATA

– ARA fuel oil inventories (STK-FO-ARA) rose 1.0% to 1.11 million tons in the week to November 20, based on data from Dutch consultancy Insights Global.

OTHER NEWS

– Oil prices fell on Friday as the U.S. pushed for a Russia-Ukraine peace deal that could swell global market supply, while uncertainty over its rate cuts curbed investors’ risk appetite.
– A large fire was extinguished on Thursday at a Venezuelan crude upgrader operated by PDVSA, the state-run company said, but operations remain halted while workers began inspections, according to three sources with knowledge of the incident.
– India’s Reliance Industries has stopped importing Russian crude oil into its refining complex at Jamnagar in western Gujarat state, effective November 20, its spokesperson said.
– Talks at the COP30 climate summit in Brazil were disrupted on Thursday after a fire broke out in the venue, triggering an evacuation just as negotiators were hunkering down to try to land a deal to strengthen international climate efforts.

WINDOW TRADES

– 180-cst HSFO: No trade
– 380-cst HSFO: Four trades
– 0.5% VLSFO: One trade
Source: Reuters