Litasco fixes VLCC to carry fuel oil on Rotterdam-Singapore route

Lukoil trading subsidiary Litasco has fixed the VLCC Yangtze Crown on a Rotterdam-Singapore route for early September loading for a $3.1 million lump sum despite a general consensus among traders and shipowners that the arbitrage East was firmly shut.
Litasco declined to comment on the fixture. Yangtze Crown's owner, Nanjing Tankers, was not immediately available for comment.
The 3.5% fuel oil Rotterdam barge market has found support from Litasco and Vitol buying over the last few weeks. Litasco has bought 128,000 mt since the beginning of August, while Vitol has taken 358,000 mt.
Vitol is likely using the product to load its two vessels currently in Rotterdam -- the ULCC TI Europe and VLCC Callisto Glory -- ahead of voyages East, traders said. Vitol declined to comment.
On August 2, FOB Rotterdam 3.5% barges reached a $26.50/mt premium to front-month swaps, the highest since Platts began tracking the spread in March 2000.
"The strong backwardation was due [to a] bull play, it didn't reflect market fundamentals. I'm still quite bearish on local conditions," a trader said, adding that RMK 500 CST fuel was trading at minus $16/mt to 3.5% fuel oil FOB Rotterdam barges -- the lowest this year.
Source: Platts