ENGINE: East of Suez Bunker Fuel Availability Outlook
VLSFO stems are in tighter supply in Singapore. Recommended times are up by three days from last week, to 6-8 days now. Bunker demand has picked up in Singapore after a few weeks of muted demand, which could explain the longer lead times, sources say.
The bunkering hub’s lead times for HSFO380 and LSMGO are unchanged on the week, however. LSMGO stems need 4-5 days of lead time, and HSFO380 around 10 days.
Lower net imports have drawn residual fuel oil out of Singapore’s inventories, which dropped to two-month lows of 23.98 million bbls last week, Enterprise Singapore data showed.
Higher fuel oil exports to Malaysia, China and Bangladesh contributed to draw fuel out of storage. A rare 36,000 mt cargo bound for South Africa – where supply of HSFO has been tight for several months – also boosted exports. Singapore’s fuel oil imports fell on the week.
Fuel availability continues to be ample in Zhoushan and Shanghai. Recommended lead times are steady on the week at 2-3 days for all three fuel grades, which is the shortest among major East of Suez ports.
Chinese river ports, including Nantong and Zhangjiagang, are seeing better HSFO380 and VLSFO availability now, after tightening supplies in the first half of the month.
VLSFO and LSMGO remains tight for certain prompt dates in South Korean ports, but lead times are roughly steady on the week at 4-5 days and there is more fuel around amid waning demand.
South Korea’s southern ports have been pricing VLSFO more competitively with Zhoushan in recent days. Their premiums over Zhoushan narrowed considerably on Tuesday after Zhoushan’s price gained on several higher-priced stems. The lowest-priced South Korean ports have VLSFO at $6-17/mt above Zhoushan, which is down from $20-30/mt last week.
Stems of all grades can be tight for prompt dates in Fujairah, where recommended lead times have held steady from last week at six days for VLSFO and LSMGO, and eight days for HSFO380.
The UAE bunker hub’s heavy distillate and fuel oil inventories fell by 11% to a four-week low of 12.36 million bbls last week, data from the Fujairah Oil Industry Zone (FOIZ) and S&P Global Platts showed.
Fujairah’s bunker demand weakened slightly last month. Total bunker sales fell by 1% from April, to just under 658,000 mt in May, according to FOIZ and Platts. That translates to an average of 21,200 mt/day in May, down 900 mt/day from April.
The port’s 380cst VLSFO sales fell by 3,800 mt on the month, HSFO380 by 3,000 mt, and combined LSMGO and 0.50% MGO sales were down by 1,100 mt. Lower-viscosity 180 cst VLSFO grew in popularity, however, with sales up by 1,800 mt.
Source: ENGINE (https://engine.online/)