Asia’s spot premium for 0.5% very low sulphur fuel oil eased for a seventh consecutive session to a three-month low on Friday, while Kuwait’s Al Zour closed a term tender in the previous day.
Kuwait is set to ramp up refined oil product exports from its new Al Zour refinery in the second half of 2023 to plug Russian shortfalls in Europe and meet growing demand in Asia and Africa, industry sources and analysts said.
The refinery has issued at least 10 VLSFO supply tenders, including seven spot cargoes and three semi-term tenders that each offered one cargo per month for three months.
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It awarded its latest term tender for loading between March and May to Glencore at an unknown discount to Singapore quotes, according to trade sources.
The first cargo is scheduled to load between March 12 to 13, while dates for April and May will be scheduled later. The cargo volume ranges from 120,000 tonnes to 150,000 tonnes, stable to higher from its previous cargo size.
Underpinned by strong supplies, the 0.5% VLSFO cash differential (MFO05-SIN-DIF) fell further to $5.68 a tonne on Friday.
Bunker fuel premiums in the delivered market at Singapore have also crashed in the week to levels of low $10s over Singapore quotes, as demand softened in February.
ARA INVENTORIES (STK-FO-ARA)
Fuel oil inventories in the Amsterdam-Rotterdam-Antwerp (ARA) refining and storage hub rose 9% to 1.17 million tonnes in the week ended Feb. 23, latest data from Dutch consultancy Insights Global showed.
– Oil prices extended gains for a second session on Friday as the prospect of lower exports from Russia offset rising inventories in the United States.
– Russian oil export revenues are set to rise in March as falling freight rates and strong demand pushes Russian oil prices towards a $60 per barrel Western price cap, based on traders’ and Reuters’ calculations.
– Exxon Mobil Corp XOM is conducting maintenance at its chemical plant on Jurong Island in Singapore, a company spokesperson said.
– China’s top oil and gas major CNPC has completed a months-long reshuffle with the addition of six regional offices that report to Beijing headquarters to better coordinate and supervise its sprawling global portfolio, three company executives said.
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