Sluggish regional demand for low viscosity residual fuels, including from China, Pakistan and Bangladesh, have contributed to the build-up in supplies of the low viscosity fuels, the sources said.
The viscosity spread for February was trading at about $2.25 a tonne on Wednesday, broker sources said.
On Tuesday, the front-month viscosity spread was at its lowest since records began in 2013 at $2 a tonne, Refinitiv Eikon data showed.
Fuel oil inventories at the Fujairah Oil Industry Zone (FOIZ) fell 8 percent, or 676,000 barrels (about 101,000 tonnes) in the week to Jan. 14 to a total of 7.573 million barrels (about 1.13 tonnes), data from S&P Global Platts showed.
In the week before, Fujairah fuel oil inventories had soared 33 percent to a near-three month high of 8.249 million barrels (about 1.231 tonnes). Fujairah fuel oil inventories were 11 percent lower than the same time last year. Fujairah's weekly fuel oil stocks averaged 7.897 million barrels (1.179 million tonnes) in 2018.
No high-sulphur fuel oil (HSFO) cargo trades were reported in the Singapore trading window. No 0.5 percent low-sulphur fuel oil (LSFO) cargo trades were reported.
South Korea's Korea District Heating Corporation (KDHC) is seeking a 30,000-tonne cargo of fuel oil with a maximum viscosity of 300-cst and a maximum sulphur content of 0.3 percent for delivery into Pyeongtaek over Feb. 8-15 in a tender closing on Jan. 21.
South Korea's East West Power Co Ltd (EWP) bought 30,000 tonnes of 540-cst fuel oil with maximum 0.3 percent sulphur content for delivery into Ulsan over Jan. 27-31 from GS Global at a premium of about $44 per tonne to the average of Singapore 180-cst HSFO quotes for January on a CFR basis.
South Korean utility Western Power Co (WP) also bought 45,000 tonnes of 540-cst fuel oil with a maximum 2.59 percent sulphur content for Jan. 17-26 delivery into Pyong Taek from Trafigura at about $420 per tonne on a CFR basis.