VLCC exports support fuel oil

摘要

Exports to Asia-Pacifc are supporting fuel oil. Slim demand is weighing on gasoline and naphtha. Middle distillates are flling up storage, refected in a steeper contango — prompt prices at discounts to forward deliveries. VLCC fuel oil fxtures to Singapore have been drawing product from storage in the Rotterdam area and buoying fuel oil margins (see graph, left). But a growing surplus in east Asia is pushing Singapore fuel oil swaps into deeper contango as suppliers are forced to turn to more expensive foating storage options.