Argus Media: VLSFO bunker premiums in Singapore on the decline
- Published
by Admin
Delivered premiums of very-low sulphur fuel oil (VLSFO) bunkers in Singapore are falling after several months of strength due to rise in cargo inflow and weak spot demand.
4 August 2022
The additional cost to deliver VLSFO bunkers on top of the cargo price on 3 August was assessed at $49.56/t, down from an average of $95/t during July.
Premiums are falling as the market is expecting higher inflows of VLSFO cargoes from the west of Suez and Asia-Pacific this month, owing to margins having previously been at record levels.
High premiums and high outright prices have curtailed spot demand in recent weeks, with both buyers and sellers largely holding off.
Market participants are now returning to the spot market as crude prices are on the decline because of inflation and recession worries, and arbitrage inflows of VLSFO are picking up.
Argus on 3 August assessed VLSFO bunkers at $752.31/t, a sharp decline of $55.62/t compared to 2 August. Other key bunker grades such as high-sulphur fuel oil (HSFO) and low-sulphur marine gasoil (LSMGO) also fell, but comparatively less than VLSFO.
This incentivised buyers to come back to the market, with Argus reporting 16 spot deals in Singapore, up from a more typical 10 per day.
By Sammy Six
Related: Argus Media: Price volatility grips Singapore bunkers market
Related: Argus Media: Higher Singapore VLSFO bunker prices driving ships away
Photo credit and source: Argus Media
Published: 5 August, 2022
