Asian marine fuel market recovery slows amid thin demand, ample supply

Initial signs of recovery seen in the Asian marine fuel market have faded amid ample supply and slow demand with the contango structure weakening from three-month highs reached June 5, market sources said June 12.

Market structure for the benchmark Singapore Marine Fuel 0.5%S swaps had inched up from a one-month low of minus $9.80/mt on May 29 to be assessed at minus $4.75/mt on June 5 — a three-month high, S&P Global Platts data showed.

But at the end of the Platts Market on Close process on June 12, the contango deepened to minus $6.75/mt, reflecting slowing demand recovery.

“Right now, demand is flattish to slightly weaker compared to that at the end of May. Spot [bunker] sales have been reasonably steady, but the amount being sold on term this month has declined quite a bit for our company,” a Singapore-based bunker supplier said.

Negotiations for the term supply of Singapore ex-wharf Marine Fuel 0.5%S bunker fuel for July were largely inconclusive, as the market was still awaiting cues on near-term price direction amid a wide bid-offer spread.

A lack of incremental demand also weighed on the spot Singapore-delivered Marine Fuel 0.5%S bunker market. The differential between Singapore gasoil 10 ppm cargo and Singapore-delivered Marine Fuel 0.5%S bunker, which had touched a six-month high of $34.87/mt on June 9, has since narrowed to $32.78/mt June 12, Platts data showed.

A fair share of IMO-compliant marine fuel in Asia is bought and sold basis Singapore 10 ppm gasoil assessment
Source: Platts

Leave A Reply

Your email address will not be published. Required fields are marked *