Is the bottom in for Euro Hi5 or will the falling knife keep falling (and cutting)?

In my previous piece published in mid-March, I argued that the short term odds skewed to the downside for the high sulphur complex basis what blending economics were suggesting at that point. Of course, this was at the risk of a rather short runway before summer stocking season starts.

(See “Will the catalyst come for the high sulphur complex or is the runway too short?” – 14 March).

Crack didn’t really react much after the call but Singapore high sulphur physical premiums and spreads collapsed two weeks after. Since then, we have seen the prologue (could it be the epilogue?) of the tariff war play out in a short few days with all the volatility.

In recent days, we also saw more summer burn stocking from EGPC with the 850kt tender (is it even surprising…)

If you watched our Sparta webinar the MED ECA early March, you know that I have repeatedly argued that the impact of the MED ECA on the 0.5 complex in reality might not be as much as Mr. Market was assuming.

For a refresher on the argument, there is some 800-900ktpm of VLSFO demand in the MED, split between transit and MED-based traffic.

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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