Refining margins for high sulphur fuel oil (HSFO) closed the final trading day of the month at more than one-year highs, data showed Monday.
The front-month 180-cst HSFO crack rose to a discount of $4.26 a barrel by 0830 GMT, while 380-cst HSFO crack climbed to a discount of $5.36 a barrel.
HSFO margins have risen by more than 20% in the month, buoyed by steady feedstock demand from China, though buying has shown signs of tapering off slightly, trade sources said.
Meanwhile, the very-low sulphur fuel oil (VLSFO) market held steady on Monday, after spot differentials recently rebounded back into premiums from discounts.
The cash differential for 0.5% VLSFO was pegged at a premium of $2.75 a metric ton on Monday, while front-month margin closed slightly higher at a premium of $8.81 a barrel by 0830 GMT.
Nonetheless, refining margins for VLSFO have fallen by more than 6% this month, weighed by steady incoming supplies.
In tenders, Sri Lanka’s Ceypetco is seeking 30,000 tons of HSFO for delivery at Colombo between September 25 and 26.
BUNKER UPDATES
Methanol producer OCI Global will supply shipping company X-Press Feeders with OCI HyFuels’ green methanol at the Rotterdam port from 2024, the companies said in a recent joint statement.
The green methanol will be used to refuel newbuild methanol dual-fueled common feeder ships owned by X-Press Feeders.
This also marks OCI HyFuels’ second green methanol sale in the marine sector, following an earlier partnership with shipping major Maersk to refuel the world’s first green methanol-powered container vessel.
OTHER NEWS
– Oil prices edged lower on Monday, but were set to post their biggest monthly gains in more than a year, on expectations that Saudi Arabia would extend voluntary output cuts into September and tighten global supply.
– Goldman Sachs on Sunday revised up its global oil demand forecast for the year while sticking to its 12-month Brent price projection of $93 per barrel, as higher realized inventories offset the demand boost from a less pessimistic growth outlook.
– Saudi oil giant Aramco’s base oil subsidiary reported a small jump in second-quarter profit on Sunday, mainly on lower income tax expenses and zakat, or charitable deductions, it said in a bourse statement, despite a 22% drop in sales.
– Portugal’s Galp Energia posted on Monday a 3% drop in second-quarter adjusted net profit from a year ago and said its core earnings fell 26%, reflecting the sale of Angolan upstream assets and lower oil and gas prices.
Source: Reuters reported by Jeslyn Lerh and edited by Krishna Chandra Eluri
