Asian high sulphur fuel oil (HSFO) posted modest declines on Tuesday after the United States waived sanctions on Iran for 60 days from Monday.
Price declines were capped as markets have priced in a recovery in Middle Eastern HSFO volumes out of the Strait of Hormuz for the next one to two months, some traders said.
In contrast, very low sulphur fuel oil (VLSFO) maintained upward momentum as supply tightness persisted for prompt loadings. Downstream bunker premiums have soared in recent sessions, traders added.
Meanwhile, cracks were steady to softer for both grades. The VLSFO crack (LFO05SGBRTCMc1) dipped slightly to a premium near $13 a barrel, while the 380-cst HSFO crack (FO380BRTCKMc1) slipped to a discount near $9 a barrel, based on LSEG data.
In the regional market, more fuel tenders closed on Tuesday, according to market sources.
South Korea’s S-Oil offered 23,000 tons of slurry for loading from Onsan between July 8 and 12. Separately, Taiwan’s FPC offered 10,000 tons of pyrolysis fuel oil for loading from Mailiao between July 24 and 28, while CPC sought 36,000 tons of low sulphur fuel oil for delivery into Keelung within August.
REFINERY UPDATES
– Australian fuel retailer Viva Energy said on Tuesday its Geelong refinery was expected to return to more than 90% capacity this week, but said its alkylation unit has been isolated from refining operations and would remain offline.
OTHER NEWS
– Oil prices fell more than 1% on Tuesday, extending losses from the previous session, on signs of some progress in restoring crude flows through the Strait of Hormuz following U.S.-Iran peace talks.
– The United States waived sanctions on Iran for 60 days from Monday after the first talks under a nascent peace deal, while officials reported a sustained lull in fighting in Lebanon under the agreement aimed at ending hostilities across the region.
– India’s imports of liquefied petroleum gas from the U.S. are set to top 1 million metric tons in June, a record high, industry sources said, as New Delhi turned to costlier suppliers to offset disruption from the Middle East.
– Global gas flaring rose to a six-year high in 2025, driven by increases in Russia and Iran, according to World Bank data, hindering efforts to end the routine burning of gas produced alongside oil by the end of this decade.
WINDOW TRADES
– 180-cst HSFO: No trade.
– 380-cst HSFO: No trade.
– 0.5% VLSFO: One trade.
ASSESSMENTS
|
FUEL OIL |
||||
|
CASH ($/T) |
ASIA CLOSE |
CHANGE |
PREV CLOSE |
RIC |
|
Cargo – 180cst |
447.95 |
-13.74 |
461.69 |
(FO180-SIN) |
|
Diff – 180cst |
5.70 |
-0.20 |
5.90 |
(FO180-SIN-DIF) |
|
Cargo – 380cst |
438.60 |
-14.73 |
453.33 |
(FO380-SIN) |
|
Diff – 380cst |
4.35 |
-0.45 |
4.80 |
(FO380-SIN-DIF) |
|
Cargo – 0.5% VLSFO |
598.50 |
-13.57 |
612.07 |
(MFO05-SIN) |
|
Diff – 0.5% VLSFO |
26.00 |
-1.35 |
27.35 |
(MFO05-SIN-DIF) |