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Asian fuel oil steady on ample regional demand

SINGAPORE: Physical Singapore fuel oil prices were unchanged on Friday, supported by healthy regional demand.

Traders said January supplies out of Singapore looked ample to meet supply requirements from Sri Lanka, Indonesia and China.

But they said a cargo of second half January fuel oil from the Middle East was offered this week, but no buying interest emerged as further sales possibilities were elusive.

Taiwan tightened supplies slightly when it purchased an extra cargo of fuel oil late on Thursday, after purchasing two earlier in the day in its January/February buy tender.

Traders said they were slightly disappointed that the extra demand expected from China ahead of the Chinese New Year holiday was not particularly strong.

Arbitrage windows from Northwest Europe, the Mediterranean and the United States had been open, but traders said arbitrage flow had slowed recently as sales outlets in Asia became less certain through the first half of February.

They said cargoes contracted now would arrive in second half February, after Chinese New Year when restocking demand was expected.

Market players expected arbitrage windows from the West to close as more than the usual amount of Western refiners were to shut for maintenance in the first quarter which would increase prices in Europe and the United States.

The LSWR market was soft, traders said, as arbitrage opportunities to the United States were non-existent due to the warm weather in North America.

In the fob Singapore market, no deals were done.

A cargo of 180-cst lifting January 22-26 was offered down to $138.00 per tonne against a bid at $137.00.

The $137.00 bid was equal to the best bid heard on Thursday.

Another cargo of 380-cst lifting January 22-26 was offered down to $134, but no buyer emerged.-Reuters