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Asia Fuel Oil-380-cst cash premiums extend gains to more than one-month high

by August 28, 2017 General

Cash premiums on Asia’s 380-cst fuel oil extended gains on Monday, climbing their highest in more than a month as firm buying interest lifted cash differentials of the mainstay fuel for a second consecutive session.

Three cargo trades were reported in the Platts window, totalling 60,000 tonnes of 380-cst fuel oil.

Mercuria bought two 20,000 tonne cargoes of the fuel from Vitol and Trafigura while Brightoil bought the third 20,000 tonne cargo from Mercuria.

Mercuria has been the top buyer of fuel oil cargoes in the window this month, having accumulated a total of 480,000 tonnes of the fuel, up from 40,000 tonnes it bought in July, data compiled by Reuters showed.

Glencore has been the top seller of cargoes in August. It has sold 260,000 tonnes of the fuel this month, having made no sales in July. – A total of 1.06 million tonnes of fuel oil has been traded in the Platts window so far this month.

380-cst cash premiums to Singapore quotes rose to $1.13 a tonne, up from 56 cents in the previous session and the highest since July 11.

U.S. traders are looking to import oil product cargoes from North Asia to the United States after Hurricane Harvey forced refineries across the U.S. Gulf Coast to shut down, refining and shipping industry sources told Reuters on Monday.

At least two North Asian refineries have received approaches from refineries and traders in the United States looking for prompt jet fuel and diesel cargoes, two sources familiar with the matter said. – By contrast, Harvey was seen as having no significant impact on the Asian fuel oil market so far, three industry sources said. – Since the start of the year, the U.S. exported 4.18 million tonnes of residual fuel oil to Singapore (averaging 123,000 tonnes a week), official data compiled by Reuters showed.

Industry sources said a majority of Asia’s residual fuel oil imports from the United States were cutter stocks used in blending fuel oil.

Taiwan’s Formosa offered 40,000 tonnes of 380-cst high sulphur fuel oil for Sept. 8-10 delivery from Mailiao in a tender closing on Aug. 29, an industry source said.

Taiwan’s CPC bought 20,000 tonnes of low-sulphur fuel oil from Mitsui for delivery in September at the port of Kaohsiung, Keelung or Taichung at a premium between $20-$30 a tonne to Singapore 180-cst quotes on a CFR basis, another industry source said.

OTHER NEWS – S&P Global Platts has added Ocean Bunkering Services Pte to its Asia Market On Close (MOC) assessment process for Singapore physical bunkers, the company said in a subscriber note dated Aug. 27.

This follows the inclusion of World Fuel Services (Singapore) Pte and Seven Seas Oil Trading Pte in the MOC process for physical bunkers announced in early July.
Source: Reuters (Reporting by Roslan Khasawneh; Editing by David Goodman)