Bunker prices have dipped from multi-year highs in Rotterdam and Gibraltar, and rough weather could hamper anchorage bunkering in the Gibraltar Strait today.
Changes on the day to 08.00 GMT today:
- VLSFO prices up in Durban ($4/mt), and down in Rotterdam ($12/mt) and Gibraltar ($10/mt)
- LSMGO prices up in Gibraltar ($2/mt), and down in Durban ($12/mt) and Rotterdam ($9/mt)
- HSFO prices down in Rotterdam ($13/mt) and Gibraltar ($6/mt)
Rotterdam’s HSFO380 and LSMGO prices rose with Brent to their highest levels in since October 2014 yesterday. The bunkering hub’s VLSFO price had never been higher, at more than $600/mt, and even surpassed the highs it made when demand spiked during the IMO 2020 transition.
Rotterdam’s VLSFO price had quadrupled from a low of almost $150/mt in April last year, when global oil demand was crushed by the rapid spread of Covid-19 and consequent global lockdown restrictions.
Gibraltar’s VLSFO price peaked at about $100/mt higher than its current value in January 2020, when unprecedented demand congested Gibraltar Strait ports and pushed its price above $700/mt.
In the past day, Rotterdam and Gibraltar’s VLSFO price have come off slightly with Brent.
Durban’s price for the grade has edged higher and risen above Richards Bay and Cape Town’s prices. The price gain in Durban has still been outpaced by that in Port Elizabeth, pushing Port Elizabeth’s price to a $26/mt premium over Durban.
Strong winds and swells from the east could disrupt deliveries in the Gibraltar Strait ports today. Two suppliers are delayed by several hours in Gibraltar and Algeciras, while Ceuta has no delays to far, according to port agent MH Bland.
Calm seas are forecast in the Canary Islands until Thursday, when rising swells could hamper bunkering at Las Palmas’ outer anchorage.
Brent
Front-month ICE Brent crude has come off by $0.57/bbl on the day, after rallying to seven-year intraday highs of nearly $86/bbl yesterday. At 08.00 GMT today, the futures contract had come down to $84.86/bbl.
“A fall in US industrial production in September would have not helped sentiment, along with weaker GDP numbers from China,” ING strategists Warren Patterson and Wenyu Yao said today.
Yesterday’s drilling report from the Energy Information Administration (EIA) also weighed on sentiment. US shale oil production is expected the increase by 77,000 b/d from October to 8.22 million b/d in November, with a boost from the Permian region.
Brent ran out of steam temporarily yesterday, before picking up again today amid continuous expectations of tightening global oil supply. In the absence of more OPEC+ crude barrels in the market, and with forecasts of a colder temperatures in northern China, Brent has seen renewed support today.
Heating oil demand is buoyant in China, the world’s biggest energy consumer, amid depleted coal and natural gas stocks and spiralling prices. Power plants across Asia and Europe have increasingly been looking towards fuel oils and diesel as feedstocks ahead of peak seasonal winter demand.