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Asia Fuel Oil-Cash differentials still under pressure; regional demand weak

The 380-cst fuel oil cash differential widened to a near one-week low on Tuesday, under pressure from by ample supplies with no signs of improvement in regional demand for the heavy distillate.

The 380-cst cash differential stood at minus $3.05 a tonne to Singapore spot quotes, down 55
cents a tonne from the day before, Reuters data showed.

Weak market fundamentals were the most pronounced in the prompt loading dates over May,
which saw strong offers but little or no buying interest.

Singapore-based trader Hin Leong had an outstanding offer for 20,000 tonnes of 380-cst for
loading over May 7-11 at $590 a tonne, an equivalent of discounts of $3.80-4.13 a tonne to
Singapore spot quotes, close to $1 a tonne below current market values, Reuters calculations
showed.

Singapore's bunker demand, which is one of Asia's largest demand outlet for fuel oil, is also saw barely any pick up, traders said.

Marine fuel sales hit a 13-month low in March of 3.18 million tonnes, 10 percent below the
monthly average last year.

Despite the weak demand, arbitrage supplies from the West are still coming in relentlessly.
Around 3.6 million tonnes of fuel oil are scheduled to make a landfall in Singapore in May,
while another 500,000 tonnes are slated to arrive in China and South Korea.

*CASH DEALS
BP sells to Unipec 22,000 tonnes of 180-cst for May 10-14 at a discount of 50 cents per tonne to the average of balance April Singapore spot quotes.

Vitol bought from Hin Leong 20,000 tonnes of 380-cst for May 12-16 at $590 a tonne.

Source: Reuters (Reporting by Jane Xie, editing by David Evans)