Japan's delivered marine fuel 0.5%S bunker price is lowest in Asia
20th October 2020 10:51 GMT

 Poor bunker fuel demand at Japan's Tokyo Bay has dragged the price of delivered marine fuel 0.5%S bunker at the port to be the lowest among key ports in Asia, even below that of Hong Kong, where a quarantine rule put in place for cargo ships has decimated demand.

Tokyo bay delivered marine fuel 0.5%S bunker averaged at $316/mt in the week of Oct. 13-19, compared with an average of $320/mt in Hong Kong, $343/mt in Asia's bunkering hub of Singapore, $350/mt in South Korea and $347.40/mt in Shanghai, Platts data showed.

"We had expected more orders after China returned from their golden week holidays, but it didn't happen," a trader said. China's week long National Day holidays ended on Oct. 9.

Despite the cap in supply arising from refinery run cuts and low inventory, bunker premiums came under pressure due to lackluster demand.

Japan's crude throughput fell 3.7% week on week, extending the previous week's decline, to 2.23 million b/d over Oct. 4-10, with refinery utilization rates having fallen to 63.5% of capacity, latest Petroleum Association of Japan data showed.

Reflecting the slow demand in October, Tokyo bay delivered marine fuel 0.5%S differential to benchmark FOB Singapore marine fuel 0.5%S cargo assessments collapsed from $25.26/mt in September to minus $3.08/mt to-date in October, Platts data showed.

"Traders will have to compete and price aggressively to move contract cargoes before the month's end," another trader said.

Traders in Japan receive a monthly volume quota under contracts with refineries, and typically strive to clear their allocated volume each month.


Bunkerworld .,
20th October 2020 10:51 GMT