BUNKER PRICES EXPECTED TO RISE IN SOUTH KOREA

BUNKER PRICES EXPECTED TO RISE IN SOUTH KOREA

Competition for sales between South Korea and Singapore has weakened the market for 380-centistoke bunker fuel in Asia, regional sources said, but South Korean prices are expected to rise in the next few weeks.

Maintenance at a hydrocracking unit at Yukong Ltd. has left the company with large stocks of fuel oil, which the firm has tried aggressively to sell since September, sources in Seoul said.They said the unit should be back in operation by November, however, removing pressure on the market.

One South Korean trader predicted that South Korean prices for the 380- centistoke bunker grade will be $2.50 to $3.50 a metric ton above those in Singapore by November.

However, traders said, competition from Taiwan may provide some pressure.

According to a source at Taiwan's state-run Chinese Petroleum Corp., bunker prices in Taiwan currently are lower than those in Japan and South Korea, but at similar levels to Singapore.

Traders in Singapore said weak demand for bunker from ships, reflecting a global slowdown in the shipping industry, may counter any price support seen

from the end of the Yukong maintenance.