Fuel oil stocks in Singapore rebounded and the tight spot market situation eased | Fuel Oil_Sina Finance_Sina.com

Source: Daotong Futures Author: Daotong Futures

Research report text

【1. Brief introduction】

As of the week of February 22, Singapore’s fuel oil inventory was 22.641 million barrels, an increase of 1.915 million barrels from the previous week. The supply of low-sulfur fuel oil in Asia has increased and the demand has been weak. Low-sulfur prices have continued to fall. However, due to the low-sulfur cracking, low valuations have begun to appear. In the case of a large price difference between the East and the West, the arbitrage trading window is still open, and a large amount of arbitrage fuel oil pours into the Asian market to suppress the sentiment of the Asian market. In the Singapore spot market, PetroChina sold 26,000 tons of 180cst high-sulfur fuel oil to Sinopec Hong Kong and Singapore for shipment on March 7-11. The operation idea is to operate with weak shocks, wait and see, pay attention to stop profit and stop loss.

【2. Today’s Highlights】

1. Daniel Obajtek, CEO of Polish state-owned oil company PKNOrlen, said that the company stopped receiving oil from Russia through the Friendship oil pipeline. After the conflict between Russia and Ukraine broke out last year, Poland reduced its oil imports, and Russian oil now accounts for about 10% of Poland’s oil supply. Consumers will not be affected by the halt in oil delivery, the company said. The company said it was ready, but did not give a reason.

2. Medvedev, Vice Chairman of the Security Council of the Russian Federation: The West is still sending weapons to Ukraine, preventing any possibility of resuming negotiations. Medvedev said that Western countries have never given up their intention to disintegrate Russia, and it was this approach of the West that eventually led to the start of Russia’s special military operations.

3. US President Biden said in an interview with the American Broadcasting Corporation (ABC) that he does not think China will “proactively provide weapons to Russia.” But he said he would “respond” if China did so.

【3. Variety Details】

The supply of low-sulfur fuel oil in Asia is increasing and the demand is weak. The price of low-sulfur fuel continues to fall. However, due to the fall of low-sulfur cracking, the undervaluation begins to appear. On the one hand, fuel oil inventories in Singapore have rebounded, and the tight spot market has eased. With the seasonal maintenance season of refineries approaching in March, the output of related oil products may decline marginally, which will boost the cracking price difference of low and high sulfur fuel oil to a certain extent. In the case of a large price difference between the East and the West, the arbitrage trading window is still open, and a large amount of arbitrage fuel oil pours into the Asian market to suppress the sentiment of the Asian market. Fuel oil arbitrage to the Asian market is expected to reach about 6 million tonnes in February, up from 4-4.5 million tonnes in January. In the Singapore spot market, P66 sold 26,000 tons of 180cst high-sulfur fuel oil to Sinopec Hong Kong and Singapore for shipment on March 17-21, which was US$1.00 per ton higher than Singapore’s quotation.

In the spot market in Singapore, PetroChina sold 26,000 tons of 180cst high-sulfur fuel oil to Sinopec Hong Kong and Singapore for shipment on March 7-11, which was $3.00 higher per ton than Singapore’s quotation, and sold 20,000 tons of P66 to Sinopec Hong Kong and Singapore 3 The 180cst high-sulfur fuel oil loaded on March 12-16 is $1.00 per ton lower than the Singapore average price in March. The Asian fuel oil market is under pressure, Russian fuel oil continues to enter the Asian market, and the demand in the shipping market is moderate. Fujairah Petroleum Industrial Zone’s bunker sales fell to an 11-month low of 627,000 tonnes in January.

Fuel oil inventories in the Amsterdam-Rotterdam-Antwerp (ARA) region fell to a two-month low of 1.08 million tonnes in the week ended Feb. 16. Fujairah fuel oil inventories fell to the lowest since January 13. As of the week ending February 13, 2023, fuel oil stocks in the Fujairah Industrial Zone in the UAE, including power generation fuel oil and marine fuel oil, were 8.158 million barrels, a decrease of 4.4% from the previous week. Heavy distillate inventories fell 19% cumulatively.

【4. Market Tracking】

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