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Commodity trading firm Noble Group is said to be looking to lease a supertanker for at least two years to use as fuel oil storage and potentially benefit from firm trading margins, Reuters reports.

Noble began its fuel oil business in April after reportedly hiring former Trafigura traders who left the global trading house over the past 12 months.

It was thought that Noble Group's entry into the fuel oil market was linked to the expectation that refinery upgrade projects in Asia and Europe could potentially lead to high trading margins due to tightening supplies of residual fuel.

As part of its fuel oil trading strategy, Noble has reportedly been seeking a long-term storage lease for the past few months. However, despite a recent jump in commercial capacity all existing tanks have been taken on long-term leases.

Other companies to have also recently entered the fuel oil market include Asian trading firm Strong Petroleum, Japan's Itochu Petroleum and China-based Southern Petrochemical Co Ltd.

Last month, Southern Petrochemical Co. was said to have acquired a supertanker to use as floating storage to trade high sulphur fuel oil (HSFO) in Singapore.

The Nan Fang 3, a very large crude carrier (VLCC), arrived in Singapore in June and is positioned at Hin Leong's anchorage. The tanker is able to blend fuel oil to meet marine fuel specifications.

Strong has also leased a VLCC, whilst Itochu recently sealed a deal to lease 150,000 cubic metres of storage at Chemoil's Helios Terminal on Jurong Island, Singapore.

Meanwhile, Guangzhou-based Southernpec paid around $15 million for a 284,000-tonne supertanker to store fuel oil. The tanker is already anchored off southern Malaysia's Tanjung Pelepas port and the company is due to start supplying bunker fuel in Singapore from next month, according to market sources.