29/07/2009
SINGAPORE, July 29 (Reuters) - Saudi Aramco has sold 80,000 tonnes of 380-centistoke (cst) cracked fuel oil for late-August loading from Jubail to Vitol at a slightly deeper discount versus earlier deals, traders said on Wednesday.
Vitol paid a discount of around $4 per tonne to Singapore spot quotes, on a free-on-board (FOB) basis, for the cargo loading on Aug. 20.
Aramco last sold a cargo for Aug. 9 lifting from Jubail to BP at a small discount to Singapore spot quotes, FOB, close to parity, traders said.
This compares with a discount of $4.50 per tonne to Singapore spot quotes, FOB, that Shell paid for a Jubail cargo which loaded on July 27.
Asia fuel oil prices, cracks and timespreads have fallen this week, as sentiment was hit by slower demand in the Singapore marine fuels market.
Hit by selling pressure in the swaps market, backwardation in the front two timespreads along the forward curve -- August/September and September/October -- shrank, while October/November and November/December spreads were pushed into a contango.
But underlying market fundamentals remain firm. Supplies are likely to remain tight for the rest of the year, due to a firm Middle East market, lower refinery run rates due to poor margins, and steady demand from the Asian bunker sector, the product's largest outlet. (
