Japan's Mar bunker supply to fall on turnaround, still enough to meet demand

Japan's bunker supply is expected to fall in March because of a turnaround at Kyokuto Petroleum Industries, but volumes are still deemed as sufficient to meet demand, industry sources said Tuesday.
KPI will shut its sole 175,000 b/d crude distillation unit at its refinery in Chiba, Tokyo Bay, over March 15 to April 26 for a planned turnaround, Platts reported previously.
The refiner normally supplies around 25,000 mt/month of bunker fuel from its Chiba refinery, but this will decline to 20,000 mt in March, trade sources said.
Other refiners will maintain their normal supply volumes in March, industry sources said. As a result, Japan's March bunker supply is expected to be around 325,000 mt.
On the other hand, bunker demand in the country has remained sluggish as Japan's bunker prices are relatively high compared with other Asian countries. The slower demand would offset the decline in supply, trade sources said.
Japan's 380 CST bunker fuel was assessed at $688.50/mt Monday, down $11/mt from a week earlier, while Singapore 380 CST bunker dropped $17.50/mt over the same period to be assessed at $643.50/mt, Platts data showed.
Traders were reluctant to lower their offers aggressively because monthly average price of Japan bunker, or their buying cost, was still high, reflective of higher prices earlier in the month.
Japanese refiners typically head into turnarounds over March-June because demand of oil products declines in the period.
Idemitsu Kosan will shut its 220,000 b/d Chiba refinery from mid-April to end-May, a company source said. The refinery is likely to reduce bunker supply over April-May, but details are not fixed, said the source.
Idemitsu normally supplies about 70,000 mt/month of bunker fuel from its refineries at Chiba, Hokkaido and Tokuyama.
Source: Platts