Marine fuel cracks collapse on Singapore stock build

London (Quantum Commodity Intelligence) - The price of 0.5% marine fuel in the bunkering hub of Singapore collapsed on Thursday relative to the price of crude oil amid a huge build of fuel oil in storage in the city-state.

Refining margin for the fuel – which is used as a lower sulfur bunkering fuel for the shipping industry – fell $1/b to $11.66/b for June after Enterprise Singapore published data showing stocks had risen by more than 10% in a week.

The data, which reflects storage from 13 major oil and storage companies, showed stocks had risen to 27.2 million, up 2.67 million barrels on the week, as bunkering was said to have occurred at other ports.

The figure means stocks in the hub are now at the highest in four years.

Flat prices collapsed accordingly, with spot prices, according to Quantum data, assessed at $494.75/mt, down $12.25/mt on the day.

And the June-July intermonth spread was valued at -$1.75/mt, down from $0.30/mt two days earlier.

The sharp move south comes as India is in the midst of a spate of tough regional lockdown as the country battles a second outbreak of covid.