Asia Fuel Oil-January Western arbitrage arrivals at 10 month high

January 3, 2013

Approximately 5.6 million tons of Western fuel oil have been provisionally booked to arrive in East Asia in January, the highest volume in 10 months, according to a Reuters survey of traders and shipping brokers reported on January 2.

The amount is 675,000 tons greater than December's shipments, and the fourth consecutive month when volumes will be higher than 4.5 million tons, the survey showed.

The continued high inflows means the supply overhang that has hit the market since October will persist, traders said.

While demand in January and February was projected to be healthier due to winter requirements in North Asia, appetite has not been as robust as the same period last year.

According to Reuters, around 4.05 million tons of shipments have been fixed so far to arrive in Asia in February, with the window for additional fixtures still open.

PetroChina was seen provisionally booking around 1.2 million tons of fuel oil from the Caribbean to China or Singapore.

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