SINGAPORE (Dow Jones)--Asia fuel oil prices fell Wednesday on overnight losses in crude futures.
In the Singapore fuel oil swaps market, December swaps for 180 centistoke fuel oil were quoted at $284.50-$285.00 a metric ton compared with $288.50-$289.00/ton late Tuesday.
The price has fallen by 6% so far this month, but many Chinese buyers still deem it as too high.
"Crude futures in New York are about $57 a barrel now, almost the same as four months ago. However, the current cargo price of (180 cst) fuel oil is still about $30/ton higher than four months ago," said a trader for an end user in South China.
Partly due to this, demand from Chinese buyers, while increasing, is still not as strong as previously expected.
Taiwan's Formosa Petrochemical Corp. sold a 30,000-ton cargo of 180 cst fuel oil with 1% sulfur content, 1.06%-1.07% density for November loading to a Chinese trading house, said a company official Wednesday.
The premium of this cargo was lower than usual due to its high density, said the official, who declined to provide more details.
The export volume for December has yet to be decided, he added.
China is also a major buyer for South Korean exports.
GS Caltex, the second-largest refiner in the country, has sold 80% of its cargoes for December loading to China and Singapore, said a company official.
The company plans to export about 200,000 tons of straight-run fuel oil for December loading, unchanged from November, the official also said.
The bulk of December cargoes have already been sold out, with premiums less than $10/ton over the Singapore mean, on a free-on-board South Korea basis, he noted.
In the Singapore cash market, no deal was done Wednesday.
The cargo price of 180 cst fuel oil fell $4.65/ton from Tuesday to $289.05/ton.
-By Sherry Su, Dow Jones Newswires