September 13, 2012 / 10:52 AM / 5 years ago

Asia Fuel Oil-China keeps fuel oil supported

SINGAPORE, Sept 13 (Reuters) - Recovering Chinese demand kept the Asia fuel
oil market supported on Thursday, with traders eyeing a potential supply crunch
in the first-half of the next quarter.
    Supply disruptions are expected following a fire at Venezuela's largest
refinery in late August. The OPEC member is a leading supplier of fuel oil into
Asia through Chinese trader PetroChina.
    Demand has been picking up in China, particularly among the smaller teapot
refiners as inventories start to ease. Another boost to demand has been the
healthy refining margins for gas oil.
    "At the moment demand is picking up, but it could be better," a
Singapore-based fuel oil trader said.
    "As always the Chinese buyer is extremely price sensitive, if we had a
slightly softer flat price we would have seen a quicker take up, so buyer and
seller are still haggling over the price point."
    The fuel oil timspread for September/October inched up 13 cents to a
backwardation of $4.13 a tonne, while the October/November backwardation
remained firm at $4.13 a tonne, according to Reuters assessment. 
    
    *TENDERS:
    - Taiwan's Formosa Petrochemical Corp is offering 10,000 tonnes of
pyrolysis fuel oil (PFO) and 35,000 tonnes of high sulphur fuel oil (HSFO), for
Sept. 28-30 lifting from Mailiao, via tender which closes on Sept. 14, with
same-day validity. 
    
    *CASH DEALS: No trades reported
    
 CASH ($/T)             ASIA CLOSE  Change  % Change  Prev     RIC
                                                      Close    
 Cargo - 180cst             697.55   -1.45     -0.21   699.00  FO180-SIN
 Diff - 180cst                3.95    0.00      0.00     3.95  FO180-SIN-DIF
 Cargo - 380cst             682.50   -3.65     -0.53   686.15  FO380-SIN
 Diff - 380cst                3.15   -1.15    -26.74     4.30  FO380-SIN-DIF
 Bunker (Ex-wharf)-         689.00   -4.00     -0.58   693.00  BK380-B-SIN
 380cst                                                        
 Bunker (Ex-wharf)            6.50   -0.35     -5.11     6.85                  
 Premium                                                       
                                                                               
 SWAPS  ($/T)           ASIA CLOSE  Change  % Change  Prev     RIC
                        (0830 GMT)                    Close    
 Brent M1                   115.81   -0.32     -0.28   116.13              
 180cst M1                  698.25   -1.00     -0.14   699.25                
 180cst M1/M2                 4.13    0.13      3.25     4.00                
 180cst M2                  694.13   -1.12     -0.16   695.25                
 Visco M1                    14.50    1.00      7.41    13.50                
 Visco M2                    14.25    1.00      7.55    13.25                
 380cst M1                  683.75   -2.00     -0.29   685.75                
 380cst M1/M2                 3.88    0.13      3.47     3.75                
 380cst M2                  679.88   -2.12     -0.31   682.00                
 Cracks 180-Dubai M1         -5.87   -0.05      0.86    -5.82                
 Cracks 180-Dubai M2         -5.91   -0.04      0.68    -5.87                
 East-West M1                40.25    1.00      2.55    39.25             
 East-West M2                37.25    0.75      2.05    36.50             
 Barges M1                  658.00   -2.00     -0.30   660.00               
 Barges M1/M2                 1.13   -0.12     -9.60     1.25                
 Barges M2                  656.88   -1.87     -0.28   658.75               
 Crack Barges-Brent M1      -14.75    0.03     -0.20   -14.78                
 Crack Barges-Brent M2      -14.71    0.09     -0.61   -14.80                
 
   
 

 (Reporting by Lee Yen Nee and Luke Pachymuthu; Editing by William Hardy)

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