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Singapore fuel oil inventories increase by 2.6%, highest level in two weeks

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Onshore residual fuel stocks in major trading hub Singapore rose 2.6%, the highest level in two weeks, data showed on Thursday. Onshore fuel oil inventories stood at 21.09 million barrels (3.32 million tonnes) in the week ended December 27, based on the latest data from Enterprise Singapore. Approximately 227,000 tons of exports left Singapore, down 26% from the previous week.

The top three export destinations are China, Bangladesh, and Hong Kong, the same as last week. Meanwhile, the top countries for Singapore’s net fuel oil imports were Brazil, Japan, and the United Arab Emirates. Singapore’s weekly net imports fell 42% to 541,000 tonnes in the week ended December 27, data showed. Despite the decline in net imports, weekly inventories increased slightly as storage economics may have improved amid weaker backwardation in recent weeks.

A reverse market structure means that the product’s current value is higher than its value in later months. Strong backwardation typically encourages traders to release oil from storage, while weak backwardation may allow for more storage.

The monthly spread for 0.5% ultra-low sulfur fuel oil, an indicator of market backwardation, has fallen significantly from a 16-month high hit in mid-November. Based on LSEG data, the month-on-month spread reached $30 per ton on November 20, but has since softened to $7 per ton as of November 27. December 27 Total Fuel Oil Net Total (metric tons) Import Export Import Algeria 31,764 0 31,764 Azerbaijan 19,195 0 19,195 Bangladesh 0 18,654 -18,654 Brazil 136,797 0 136,797 Bulgaria 5,317 14 5.3 02 China 0 62,011 -62,011 Estonia 18,755 0 18,755 Fiji 0 6,018 – 6,018 Hong Kong 0 10,990 -10,990 India 7,978 0 7,978 Indonesia 40,393 2,695 37,697 Italy 24,859 0 24,859 Japan 89,596 0 89,596 Kazakhstan 5,630 0 5,630 South Korea 52,111 0 52,111 Kyrgyzstan 3,401 0 3,401 Malaysia 176,667 126,073 50,594 Nepal 0 41 -41 Netherlands 3,943 0 3,943 New Caledonia 0 0 0 Romania 9,000 0 9,000 Russia 29,429 0 29,429 Taiwan 8,439 0 8,439 Turkmenistan 13,294 0 13,294 United Arab Emirates 86,030 0 86,030 Emirates United States 0 0 0 Vietnam 5, 019 201 4 ,819 Total 767,616 226,698 540,918 (Data from Enterprise Singapore) (Jeslyn (Report by Lerh; Edited by Tomasz Janowski)



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