ENGINE: East of Suez Bunker Fuel Availability Outlook
There is now more fuel oil stored in Singapore than there was on average per week in May and April.
Singapore’s residual fuel oil stocks jumped to three-week highs on higher imports last week, while middle distillate stocks slumped to their lowest level point since March 2020, Enterprise Singapore data showed.
Lead times are unchanged in Singapore, meanwhile, with 3-4 days recommended for LSMGO stems and 5-6 days for VLSFO. VLSFO has been tight for prompt dates for several months, while LSMGO has been more readily available in the bunkering hub.
HSFO380 continues to require a longer lead time of 10 days in Singapore, which is similar to Fujairah’s nine days.
Fujairah’s fuel oil stocks gained 16% on the week, recovering from last week’s two-year lows, data from S&P Global Platts and the Fujairah Oil Industry Zone showed.
The stock build in Fujairah’s fuel oil inventories might have eased some of the bunkering hub’s low sulphur fuel oil tightness, with lead times for VLSFO stems down by two days on the week to four days now, and lead times for LSMGO unchanged.
The Chinese port of Zhoushan has better fuel availability, with prompt supply possible for all three grades. Zhoushan has one of the shortest lead time for HSFO380 stems compared to other East of Suez ports this week, requiring only two days in advance. The neighbouring port of Shanghai is not facing any supply shortages either.
Zhoushan’s VLSFO has been at considerable discount to Singapore since late May. The price difference between the ports narrowed to around $8/mt at the beginning of this week, in a sign that Singapore is pricing the grade more competitively.
The two ports’ LSMGO price difference has widened on the week, with Zhoushan’s LSMGO priced $20/mt above Singapore’s now.
VLSFO supply has improved some in South Korean ports. Lead times in the country’s southern ports have dropped by one day, to 3-4 days.
Source: ENGINE (https://engine.online/)