Has MED LSFO been helping to create more on-spec HSFO supplies in the East?

Back in March when we conducted the webinar on the MED ECA, I reasoned out that the molecules <0.3% or >1.2% sulphur shouldn’t have much trouble getting absorbed by the new 0.1% ULSFO pool and the 3.5% pool respectively.

It was the 0.7-1% molecules that would have difficulty finding a local home and would need to be sent to the East for better blending ops.

At that point, I was thinking of those 0.7-1% molecules being blended into 0.5% VLSFO in the East at a time when Sing 0.5% was still in clear backwardation. Conventionally, 1.3-1.4% is the accepted boundary between what goes into low vs high sulphur blending and 0.7% usually falls squarely within the 0.5% blend pool.

But what if instead of blending 0.5%, you try to use these molecules to blend 3.5%/380 in say Fujairah? Can that work at all even when it’s not what people do traditionally?

Hoa brings extensive experience, having led fuel oil analysis at Trafigura and worked across crude, diesel, and APAC power markets. Hoa now leads the development of Sparta’s forward-looking tools for fuel oil and feedstocks.

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