Residual fuel oil stockpiles at key trading hub Singapore fell despite a sharp uptick in imports, showed official data on Thursday, amid a strongly backwardated market.

Onshore fuel oil inventories STKRS-SIN fell 0.5% to 19.44 million barrels (3.06 million metric tons) in the week ended Nov. 1, data from Enterprise Singapore showed. O/SING1

The dip came amid a firm market backwardation, which discourages storage economics and prompts selling interest as spot prices are higher than for later months.

Singapore’s balance-month backwardation for 0.5% very low sulphur fuel oil hit $34.50 a metric ton on Nov. 1, logging more than a year’s high, LSEG data showed.

However, a jump in net fuel oil imports capped the drawdown in the weekly inventories.

Net imports, calculated by subtracting total exports from total imports, more than quadrupled week-on-week to 1.14 million tons, based on the Enterprise Singapore data.

Most of Singapore’s fuel oil imports in the week to Nov. 1 hailed from Malaysia, Brazil and Turkey, the data showed.

Meanwhile, most of the exports were headed for China, Bangladesh and India in the same week.

Source: Reuters reported by Jeslyn Lerh and edited by Savio D’Souza