Spot differentials for fuel oil were little changed on Monday as trading momentum was largely quiet, though outright prices fell after crude extended steep losses amid a global trade conflict.

Singapore spot differential for very low sulphur fuel oil (VLSFO) was rangebound near a premium of $3 per metric ton, with bids and offers holding in a narrow range.

Meanwhile, the 380-cst high sulphur fuel oil (HSFO) spot differential hovered at a discount near $2 per metric ton.

On the derivatives patch, a collapse in crude prices pulled outright fuel oil swaps lower, while lending support to cracks.

VLSFO cracks closed higher at premiums above $9 a barrel on Monday, while 380-cst HSFO cracks climbed to discounts near 66 cents a barrel, based on LSEG data for May contracts.

REFINERY UPDATES

– Run rates for China’s struggling independent oil refiners have nudged up recently, but still face near-term pressure over tepid domestic fuel demand and supply risks from U.S. sanctions and tariffs, industry participants and analysts said.

OTHER NEWS

– Oil prices extended losses on Monday, falling nearly 4% as escalating trade tensions between the United States and China stoked fears of a recession that would reduce demand for crude while OPEC+ readies a supply increase.

– Saudi Arabia, the world’s top oil exporter, on Sunday slashed crude oil prices for Asian buyers in May to their lowest in four months, following a recent shock decision by the OPEC+ oil group to speed up oil output hikes.

– India’s state-run Bharat Petroleum has awarded a 4-month tender to import one million barrels of U.S. crude per month from June to trader Glencore, two sources aware of the deal said.

– Shares of U.S. refiners fell to near two-year lows in the wake of U.S. President Donald Trump’s announcement of new tariffs, as fears of slower fuel demand and weakening refining margins rattled investors.

WINDOW TRADES

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

Source: Reuters