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Asia Fuel Oil-Swaps drive prices up in quiet trade

SINGAPORE: Asian fuel oil prices edged up on Wednesday in lacklustre trade after buying interest in the swaps market shored up sagging sentiment.

"There was some buying from Chinese parties earlier in the day. May paper was bought up to $134 (per tonne)," a trader said.

The strong swaps rally, however, did not translate to a surge in physical buying interest as buyers held back in anticipation of a downward correction in the coming days.

"Some of this increase was because of crude, some people are holding back because they think crude is going to come off," a trader said.

Fuel oil swaps gained $4 per tonne in active trading with buying interest also seen for the prompt April paper which led to a widening of the April/May spread.

The April/May paper spread widened to about $11 per tonne compared with around $10 on Tuesday.

In the spot physical market, bids and offers were again wide apart. The lowest offer was for a 380-cst cargo for May 3-7 loading at $145, which implied that the 180-cst was at about $150, based on a $5 spread between the two grades.

Traders said Thailand was offering an end April 30,000 tonne cargo and was eyeing premiums of about $5 per tonne.-Reuters