Spot fuel oil benchmarks eased on Tuesday as ample incoming supplies weighed on sentiment.

Singapore’s cash premium for very low sulphur fuel oil (VLSFO) continued to fall after hitting a six-week low, with the product trading softer at $5 a metric ton for December dates.

Meanwhile, the cash premium for 380-cst high sulphur fuel oil (HSFO) also eased, dropping below $13.50 a ton.

Total fuel oil supplies arriving in Asia are expected to breach 7 million tons for November, just as last month, based on data from LSEG Oil Research this week.

The strong inflows were led by an uptick in western arbitrage arrivals, as well as a strong recovery in Middle Eastern barrels after summer demand retreated.

Refining margins for fuel oil trended steady to softer in Asia during recent sessions. VLSFO cracks continued to hover below premiums of $13 a barrel, while 380-cst HSFO cracks closed lower at discounts nearer to $5.50 a barrel, based on LSEG’s data at 0830 GMT.

REFINERY UPDATES

– U.S. oil refiners are expected to have about 291,000 barrels per day of capacity offline in the week ending Nov. 22, raising available refining capacity by 316,000 bpd, research company IIR Energy said.

OTHER NEWS

– Oil slipped on Tuesday, pressured by the restart of production at Norway’s Johan Sverdrup oilfield, although investor caution arising from fears of an escalation in the Russia-Ukraine war limited the decline.
– Swiss trading house Trafigura is trying to track down $500 million in Mongolia following a year-long probe of staff and associates over a billion-dollar fraud scheme at its local fuel supply business, according to three trading sources familiar with the case.
– Brazilian state-run oil firm Petrobras announced on Monday that its management proposed to the company’s board a $111 billion business plan for 2025-2029, according to a securities filing.

– Japan’s Mitsui O.S.K. Lines and Kansai Electric Power Company have signed a memorandum of understanding (MoU) for the joint study of a liquefied hydrogen carrier, the companies said in a joint statement on Tuesday.

WINDOW TRADES

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

Source: Reuters reported by Jeslyn Lerh and edited by Shreya Biswas