VLSFO’s tight, alright
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Sing 0.5% Aug/Sep timespread has blown out to +$48/mt with Aug 0.5% E/W hitting +$85/mt, indicating significant tightness in the VLSFO markets in Asia.
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Yet at this level, the VLSFO arbs into Singapore still remain shut.
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Sing 0.5% crack against Brent is also solidly above $22/bbl, marking the difficulty refineries are facing to produce more VLSFO when crude supplies are not guaranteed whilst power gen demand creeps up in the Middle East.
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There can be more upside on the crack in particular because the crude shortfall is real as we head into September processing and medium crude resupply options are getting limited in Asia.
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Dangote is expected to come back in full operations end this week, and Dangote LSSR is most valuable into the Singapore VLSFO blend hub. Al Zour and Skikda LSSR is preferentially into Fujairah.
About the Author
June is a senior oil market analyst at Sparta specialising in global crude trade flows and refining economics across Asia and Europe. Her analysis is regularly cited by Bloomberg, the Financial Times, and Reuters. With a significant following in the energy community on X (@JuneGoh_Sparta), June’s insights are a staple for institutional traders navigating regional market shifts.
Connect: LinkedIn / X
About Sparta
Founded in 2020, Sparta made waves in the commodity analytics space in March 2022 when it secured a $6m series A investment from Singular. This success then later snowballed into a further $17.5 million in a series A funding round led by the technology venture capital firm FirstMark, with participation from existing shareholder, Singular.
The platform, created by former traders Miles Moseley and Felipe Elink Schuurman, is designed to answer a common problem shared by most traders: 90% of pricing data required to make trading decisions is kept in silos and shared manually by voice, email, or chat.
Sparta breaks these existing data silos and combines the physical and paper markets to provide traders with live access to global raw prices, from futures and swaps to forward freight and physical premiums. We work with clients globally, including Philips 66, Chevron, Trafigura, Equinor and more.
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