Asia/Pacific News
Singapore: LSFO Stocks' Tally Assuage Supply Fears
Oil analysts surveyed by Reuters point to sufficient stocks of low sulfur fuel oil (LSFO) in Singapore and other regional ports to meet the expected demand IMO2020 compliant fuel.
LSFO stock-building has seen crude oil tankers employed as floating storage.
"The LSFO stock-build in these floating storage (tanks) eases the transition into 2020, and shows that it is not going to be as catastrophic as some previously thought," Serena Huang, senior market analyst at oil analytics firm Vortexa, was quoted as saying.
About 4 million tonnes of LSFO are being stored on board 18 very large crude carriers around Singapore, according to Vortexa's latest assessments, up around 14% from industry estimates for IMO-compliant LSFO and components being held in tankers in July.
Taking into account Malaysian port areas, including Linggi about 200 km (125 miles) northwest of Singapore in the Malacca Strait, estimates of LSFO stockpiles rise further, the report said.
Analysts for Refinitiv in Singapore have said that there are about 7 million tonnes of LSFO and related blendstocks in floating storage in the city-state and neighbouring Malaysia, with another 2 million tonnes of fuel fitting the new specifications in landed storage.
On the back of increasing LSFO production from global refiners, London-based Energy Aspects has revised its demand estimate for the fuel to 1.5 million barrels per day, up by 50% from its forecast in 2018, according to the report.
