August 21, 2012 / 12:04 PM / 5 years ago

Asia Fuel Oil-September/October at over 2-week low

SINGAPORE, Aug 21 (Reuters) - Asia's fuel oil market was weak on Tuesday as
the prompt September/October inter-month swaps value fell to its lowest in more
than two weeks, Reuters data showed.
    The September/October contract, the price difference between September and
October fixed-price swaps, eased 37 cents to a backwardation of $2.38 a tonne by
the Asian close on Tuesday. This is the weakest it has been since June 8,
according to Reuters data.  
    Volumes traded were thin, with around 140,000 tonnes of the
September/October contract done. 
    The physical trading window was also quiet with no deals reported. Cash
premiums, however, recovered the previous session's losses. The premium for
180-centistoke (cst) was up 30 cents to $2.20 a tonne, while the 380-cst premium
was valued 35 cents higher at $2.50 a tonne above Singapore spot quotes.
    Traders said current supply-demand fundamentals are more or less balanced.
However, if high fixed prices persist, demand could be hurt further. 
    Arbitrage arrivals for September are estimated to be around 4.5 million
tonnes, similar to August' s inflows, according to traders and shipping brokers.
    India's Essar Oil sold 45,000 tonnes of 380-cst, for Sept. 7-11
lifting from Vadinar, via a tender for a premium of $5.00-$6.00 a tonne above
Middle East quotes. The buyer could not be confirmed. 
    Spot offers continued to be seen from India, the latest being Mangalore
Refinery and Petrochemicals, which floated a tender to sell 80,000
tonnes of 380-cst for Sept. 21-23 loading from New Mangalore. The tender closes
on Aug. 22, with a one-day validity.
    MRPL previously sold a similar cargo for Sept 3-5 loading to Gunvor at a
discount of $5.00-$6.00 a tonne to Singapore quotes, on a free-on-board basis.  
          
           
    * TENDERS:
    - India's MRPL is offering 80,000 tonnes of 380-cst, for Sept. 21-23 loading
from New Mangalore, via a tender which closes on Aug. 22, with a one-day
validity.
    - Taiwan's Formosa Petrochemical Corp is offering 10,000 tonnes of
pyrolysis fuel oil, for Sept. 4-6 loading from Mailiao, via a tender which
closes on Aug. 21. 
    
    * CASH DEALS: No trades
                     
 CASH ($/T)             ASIA CLOSE  Change  % Change  Prev     RIC
                                                      Close    
 Cargo - 180cst             683.15   -0.05     -0.01   683.20  FO180-SIN
 Diff - 180cst                2.20    0.30     15.79     1.90  FO180-SIN-DIF
 Cargo - 380cst             670.80    0.35      0.05   670.45  FO380-SIN
 Diff - 380cst                2.50    0.35     16.28     2.15  FO380-SIN-DIF
 Bunker (Ex-wharf)-         676.00   -2.00     -0.29   678.00  BK380-B-SIN
 380cst                                                        
 Bunker (Ex-wharf)            5.20   -2.35    -31.13     7.55                 
 Premium                                                       
                                                                              
 SWAPS  ($/T)           ASIA CLOSE  Change  % Change  Prev     RIC
                        (0830 GMT)                    Close    
 Brent M1                   114.53    0.45      0.39   114.08              
 180cst M1                  680.75    0.12      0.02   680.63                
 180cst M1/M2                 2.38   -0.37    -13.45     2.75                
 180cst M2                  678.38    0.50      0.07   677.88                
 Visco M1                    12.63   -0.25     -1.94    12.88                
 Visco M2                    12.38   -0.12     -0.96    12.50                
 380cst M1                  668.13    0.38      0.06   667.75                
 380cst M1/M2                 2.13   -0.25    -10.50     2.38                
 380cst M2                  666.00    0.62      0.09   665.38                
 Cracks 180-Dubai M1         -6.49   -0.48      7.99    -6.01                
 Cracks 180-Dubai M2         -6.34   -0.42      7.09    -5.92                
 East-West M1                32.88   -0.50     -1.50    33.38             
 East-West M2                32.88   -0.37     -1.11    33.25             
 Barges M1                  647.88    0.63      0.10   647.25               
 Barges M1/M2                 2.38   -0.25     -9.51     2.63                
 Barges M2                  645.50    0.87      0.13   644.63               
 Crack Barges-Brent M1      -15.22   -0.31      2.08   -14.91                
 Crack Barges-Brent M2      -15.03   -0.47      3.23   -14.56                
 
 (Reporting by Lee Yen Nee; Editing by Alison Birrane)

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