EUROPEAN fuel-oil shipments to Singapore will increase 33 per cent next month as traders take advantage of prices in Asia that have been driven higher by the region's accelerating economic growth.

Fuel oil, used to power ships or burnt to generate electricity, is moving east because of declining demand in Europe, according to a Bloomberg News survey of five traders, including companies involved in this arbitrage trade.

Since last month, fuel-oil inventories at Rotterdam, part of Europe's independent storage hub with Amsterdam and Antwerp, have fallen to 577,000 tonnes, 38 per cent below a record 935,000 tonnes.

Over the same period, Singapore's onshore stockpiles of residual fuels have increased 13 per cent to 21.6 million barrels, or 3.3 million tonnes.