Singapore HSFO viscosity spread hits 21-month high on shortage of cutter stock

TIN news:  The Singapore high sulfur fuel oil viscosity spread hit its widest point in 21 months, on the back of a shortage of cutter stock, according to S&P Global Platts data and trade sources.

On Thursday, the viscosity spread between 180 CST HSFO and 380 CST HSFO was at $9.77/mt — a high not seen since August 4, 2015, when it was wider at $10.17/mt, Platts data showed.

The market has been seeing more high viscosity imports recently and has been seeking lower viscosity material, such as the 180 CST grade, to be able to blend into the mainstay 380 CST grade, which is the most widely traded grade of fuel oil, said trade sources.

On an outright basis, 180 CST HSFO was assessed at $300.09/mt on Thursday, and on a premium basis, at $3.81/mt to Mean of Platts Singapore 180 CST HSFO assessments, Platts data showed.

This is the highest the premium has been since December 30, 2016, when it was at $3.88/mt.

The 380 CST on an outright basis was at $290.32/mt Thursday and on a premium basis, at $3.20/mt to MOPS 380 CST HSFO assessments, Platts data showed.

This is the highest the premium has been since January 5 this year, when it was at $3.92/mt.

May arrivals moving from West to East are currently estimated at around 5 million mt or so, of which around 1 million mt would be high density and high viscosity material, under 1 million mt of cracked material, around 2 million mt of ready-grade for the bunker fuel market and the rest a mix of low sulfur and straight-run material, said trade sources.

Further ahead, June arrivals from West to East are expected at under 4 million mt currently, with time still available for further fixtures,