Cracks for high sulphur fuel oil (HSFO) extended gains on Friday, while 0.5% low sulphur fuel oil (VLSFO) cracks dropped amid a flurry of selling interest, trade sources said.

Singapore 380-cst HSFO cracks closed at discounts of about $2.60 a barrel, maintaining at more than two-year highs.

The market received a boost amid a tighter European market that has sent barge cracks rallying higher this month.

Meanwhile, Singapore VLSFO cracks closed lower at premiums of $15.40 a barrel as some traders sold off for profit-taking, said sources.

On the spot front, cash premiums for HSFO continued to inch higher on Friday, while VLSFO eased amid narrower backwardation.

ARA INVENTORIES

– Fuel oil inventories in the ARA rose 1.5% to 1.30 million tons in the week to Oct. 24, data from Dutch consultancy Insights Global showed.

OTHER NEWS

– Oil prices nudged higher on Friday and are on track for a weekly gain of more than 1%, as tensions in the world’s top oil-producing region, the Middle East, and a restart in Gaza ceasefire talks in the coming days kept traders on edge.

– India’s Reliance Industries Ltd, operator of the world’s biggest refining complex, is restructuring its trading operations, including moving most of its Dubai crude oil trading team back to Mumbai, two sources familiar with the plan said.

– Brazil state-run firm Petrobras plans to bring oil production at its Tupi oil field back to 1 million barrels per day by 2027 as it plans new investments in the asset, its director for exploration and production said.

– Top executives of two U.S. energy pipeline operators on Thursday ruled out building new crude oil lines to move volumes out of the Permian shale field in West Texas because of tepid volume growth and difficulties constructing new lines.

WINDOW TRADES

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

Source: Reuters reported by Jeslyn Lerh and edited by Shilpi Majumdar