Asia’s first month for 0.5% ultra-low sulfur fuel oil (VLSFO) rose on Tuesday, reaching its highest level in more than 22 months, supported by demand stable and ever tighter supplies.
First-month VLSFO crack climbed to $ 16.29 per barrel against Dubai crude during trading hours in Asia, a level last seen in February 2020. Crack was at $ 15.68 per barrel during trading hours in Asia. of the last trading session on Friday.
Cash premiums for the 0.5% VLSFO in Asia were $ 16.88 per tonne against Singapore quotes, down from $ 16.46 on Friday.
Meanwhile, Asia’s cash differentials for 380 cst High Sulfur Fuel Oil (HSFO) were at a premium of $ 1.03 per tonne to Singapore quotes on Tuesday, compared to $ 1.90 Friday.
CHINA OIL DEMAND
China’s oil consumption is expected to continue growing for a decade on the back of strong demand for chemicals, peaking at around 780 million tonnes per year by 2030, a research institute affiliated with the China National Petroleum Corp (CNPC).
In its latest report, the research group said that consumption of diesel fuel, gasoline and kerosene is expected to peak around 2025 at around 390 million tonnes per year. Strong petrochemical demand will support the increase in consumption until 2030.
Aggregate demand for oil will fall after 2030 as transport consumption declines amid electrification of vehicles while demand for chemicals remains stable over the period, ETRI said.
Source: Reuters