Asia’s cash differential for very-low sulphur fuel oil (VLSFO) slumped into a deeper discount to Singapore quotes on Tuesday, as sellers continued to lower offers for early August.

The 0.5% VLSFO cash differential was pegged at a discount of 94 cents a metric ton to Singapore quotes, though front-month crack rebounded day-on-day to a premium of $7.28 a barrel.

The market remains underpinned by an influx of supplies. Fuel oil flows landing East, most of which come to Singapore, are expected between 5.5 and 6.0 million tons in July, based on latest assessments by Refinitiv Oil Research. This compared steady to a four-month high in June.

Meanwhile, the high sulphur fuel oil (HSFO) market showed signs of cooling after its recent spike.

The cash differential for 380-cst HSFO was pegged at a premium of $12.58 a ton, while front-month crack edged slightly higher to a discount of $8.15 a barrel.

In tenders, Taiwan’s CPC is seeking 40,000 tons of low-sulphur fuel oil for September delivery. The tender closes on Tuesday.

OTHER NEWS

– Oil prices were little changed on Tuesday as investors weighed a possible tightening of U.S. crude supplies against weaker-than-expected Chinese economic growth.

– China’s diesel exports fell to the lowest level in more than a year in June as refiners curbed production in favour of more lucrative gasoline and aviation fuels.

– Indian imports of Russian crude are likely to decline on narrowing discounts and payment problems, forcing refiners to boost supplies from other sources, a senior government official told reporters.

– State-owned Pakistan Refinery Limited and Air Link Communication, a local firm, are seeking to buy a stake in Shell Pakistan, the companies said in a notice to the stock exchange.

WINDOW TRADES O/AS

– 180-cst HSFO: No trade
– 380-cst HSFO: No trade
– 0.5% VLSFO: No trade

Source: Reuters reported by Jeslyn Lerh edited by Shweta Agarwal