The volume of Singapore fuel oil derivatives traded during the Platts Market on Close assessment process in January dropped 22.8% month over month to 10.79 million barrels as the overall volumes of high sulfur fuel oil trades decreased for a second straight month, Platts, part of S&P Global Energy, data showed.

The total fuel oil swaps trades, which hit a five-month high of 15.14 million barrels in November, have now posted their lowest monthly volume since October 2025, when 10.31 million barrels of fuel oil swaps were traded. The January overall trades, however, were nearly 184% higher compared with the corresponding month in 2025, the data showed.

The Singapore high sulfur fuel oil swaps trades decreased 36.3% month over month to 7.14 million barrels in January, touching the lowest monthly volume traded for the grade since September 2025, when 5.27 million barrels of HSFO were traded, Platts data showed.

Out of the total HSFO swaps traded in January, 5.65 million barrels were that of the benchmark 380 CST HSFO trades, up about 31% from December, when they had touched a three-month low, the data showed.

The monthly rise in traded volumes comes on the back of firmer time spreads for the Singapore HSFO swaps. The M1-M2 inter-month spread for the 380 CST HSFO grade, which flipped to backwardation early-January, has averaged plus $6.57/mt during the month, compared with an average of minus $2.83/mt in December, Platts data showed.

The Asian high sulfur fuel oil market has garnered steep upward momentum in recent trading sessions, buoyed by stable bunkering activity and fewer incoming shipments from the Middle East, while the cash differential for the benchmark 380 CST HSFO grade has surged to its biggest premiums in more than seven months, Platts data showed.

Platts assessed the Singapore 380 CST HSFO cargo’s cash differential over the Mean of Platts Singapore 380 CST HSFO assessment at a premium of $11.81/mt at the Asian close Feb. 2, up from $7.67/mt in the preceding session on Jan. 30. The benchmark HSFO cash differential, which has more than doubled in the week ended Jan. 30, is currently at its highest premium since June 11, 2025, when it was assessed at $13.04/mt, Platts data showed.

In January, the volume of 180 CST swaps trades, however, slipped to 410,000 barrels, compared with 857,000 barrels in December, Platts data showed.

Meanwhile, Singapore marine fuel 0.5%S swaps trade volume increased about 32% month over month in January to 3.65 million barrels, Platts data showed. The January trade volume for the IMO 2020-compliant grade was 186% higher on a year-over-year basis, the data showed.

The M1-M2 intermonth spread for FOB Singapore 0.5%S marine fuel swaps averaged minus 15 cents/mt in January, compared with the December average at a contango of $1.10/mt, Platts data showed.

Ample arbitrage supplies from the Western markets are weighing on Asia’s low sulfur fuel oil market, although robust downstream bunkering activity ahead of the Lunar New Year has been offering some support to fundamentals.

Platts assessed the Singapore marine fuel 0.5%S cargo’s differential to the MOPS marine fuel 0.5%S assessment at a premium of 17 cents/mt at the Asian close Feb. 2, down from $1.25/mt on Jan. 30, when the cash differential posted a weekly drop of nearly 53%, Platts data showed.

In the physical market, the total volume of FOB Singapore fuel oil cargoes traded during the MOC in January decreased 20.7% month over month to 260,000 mt (about 53,258 b/d), led by a drop in low sulfur fuel oil deals, S&P Global Energy data showed.

The physical trades for FOB Singapore 0.5%S marine fuel dropped 57.4% month over month to 80,000 mt in January, recording the lowest monthly volume for the IMO 2020-compliant grade since October 2025, when no marine fuel cargo was traded, Platts data showed.

In the high sulfur fuel oil market, a total of 180,000 mt were traded during the MOC in January, of which 140,000 mt were that of the mainstream 380 CST HSFO grade, Platts data showed.

Source: Platts