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BUNKERWORLD INDEX: Prices show mixed signals amid varying local dynamics, bearish crude indicators
9th April 2021 11:34 GMT

Bunkerworld Index prices mostly reflected the bearish sentiment in crude oil markets, with notable decreases on the month but glimmers of support to 0.5% sulfur fuel oil.

The Bunkerworld 0.5%S bunker fuel pricing index ended April 8 at $483/mt, up $1/mt on the day and up $2/mt on the week but $33/mt lower than 30 days previously.

The BW380 Index, which represents value for 3.5%S FO, ended the day at $379.50/mt, which was down $1.50/mt on the day and down $7.50/mt on the week, as well as $34.50/mt lower than 30 days previously.

Crude oil markets are ever-alert to the somewhat hesitant recovery process as COVID-19 case numbers rebound in Europe and elsewhere, and the vaccination process runs into difficulties.

Just as important are developments on the supply side. Compliance with OPEC-plus production cuts showed signs of slipping in March, while output rebounded in two crucial countries exempt from the cuts process: Iran and Libya, according to latest Platts survey data.

Looking ahead in marine markets, the use of exhaust gas cleaning systems, also known as scrubbers, on board vessels, is likely to get a leg-up as the global shipping fuel sector works through potential solutions to decarbonize, industry sources said.

This was likely to give a boost to scrubber installations, even if as an interim measure till a clearer picture emerges within the ship refueling landscape on viable cleaner fuel choices.

"It's not the end solution, but can be a 'plaster on the sore' for the interim," a Singapore-based shipowner said.

At the Middle Eastern port of Fujairah, bunker fuel premiums are expected to be capped by tepid demand amid plentiful supply. The market is awash with material after tightness eased significantly from two weeks ago, with most suppliers able to offer product for very prompt dates.

Bunkering demand in Northwest Europe was expected to remain largely unchanged in the coming weeks as market participants look to supply-drive fundamentals instead. There were some reports of tight product availability of 0.5%S marine fuel in the Rotterdam area this week, and it was unknown how long this would last for. In the Mediterranean, windy weather conditions halted supply operations at Gibraltar on April 8 but conditions were expected to improve in the coming days.

Spot bunker prices in Panama have been supported more from the rise in global oil markets than strengthened demand, which has been described as “average to low.” Availability of marine fuel 0.5%S have been reported to be tight in Ecuador and, for prompt deliveries, in Peru, according to bunker sources.

The BW Indexes are weighted daily indexes made up of price assessments at 20 key bunkering ports. To obtain a representative geographical spread, the ports were selected by size with reference to their geographical importance.

The BW0.5%S Index ports are Hong Kong, South Korea, Shanghai, Singapore, Japan, Las Palmas, Durban, Fujairah, Gibraltar, Piraeus, Rotterdam, St. Petersburg, Houston, Los Angeles, New York, Balboa and Santos.

The BW380 Index ports are Busan, Canary Islands, Colombo, Durban, Fujairah, Gibraltar, Hong Kong, Houston, Los Angeles, New York, Offshore Nigeria, Panama Canal, Piraeus, Rotterdam, Santos, Shanghai, Singapore, St. Petersburg, Suez and Tokyo.

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Bunkerworld .,
9th April 2021 11:34 GMT