Singapore 0.5% marine fuel cracks rebound after inventory build

London (Quantum Commodity Intelligence) - Cracks for marine fuel (0.5% sulfur) fuel in Singapore rebounded versus Brent Friday after having collapsed the prior day on news of a large build in inventories, while flat price moves also narrowed the nearby contango, according to Quantum data.

The refining margin for the 5,000ppm sulfur bunker fuel, increased between $0.83/b and $1.07/b along the curve, with the larger moves at the front and back where underlying Brent crude prices had fallen the most.

Balance-May and June cracks for 0.5% marine fuel were assessed at $12.73/b and $11.01/b respectively at the 9.30 Singapore close Friday, representing a $0.3/b week-on-week dip for the former and a $0.2/b gain for the latter.

The reverse move on the week for May cracks for marine fuel reflected news the prior day of a 2.67 million barrel week-on-week inventory gain for the marine fuel in Singapore storage tanks.

However, distillate cracks in the region have held firm this week amid a spate of refinery maintenance and the fall across the curve for marine fuel was perhaps viewed as overdone.

The marine fuel flat price was assessed at $494/mt for the balance-May swap, a $1.50/mt discount to June and slightly down from a $1.75/mt discount on Thursday.