Europe & Africa Market Update 12 Dec

Bunker fuel prices in major European and African ports have mostly gained, and VLSFO availability is stable in Durban.

Changes on the day to 09.00 GMT today:

• VLSFO prices up in Durban ($8/mt), Gibraltar ($4/mt) and Rotterdam ($3/mt)
• LSMGO prices up in Gibraltar ($6/mt), and down in Rotterdam ($1/mt)
• HSFO prices up in Rotterdam, Durban ($4/mt) and Gibraltar ($3/mt)
• Rotterdam B30-VLSFO premium over VLSFO down $1/mt to $253/mt
• Gibraltar B30-VLSFO premium over VLSFO down $1/mt to $349/mt

Most prices have edged higher in the three major ports, following Brent’s movement.

Rotterdam's LSMGO price has seen a small dip, with a lower priced 150-500 mt stem, fixed at $610/mt, putting some downward pressure on the price.

Hi5 spreads at Rotterdam, off Malta and at Gibraltar remain between $30-$52/mt. This marks a sharp recovery from the yearly lows observed in mid-October.

Meanwhile, Durban’s VLSFO price has gained over the past day.

VLSFO availability in Durban remains normal, with a notice of 2-4 days sufficient to get deliveries, a trader told ENGINE. HSFO deliveries are tighter for prompt supplies and may need lead times of around a week, the trader added.

Strong winds of more than 35 knots and waves of over 3 metres have suspended inbound traffic at Durban, Transnet National Port Authority said in an alert.

Brent

The front-month ICE Brent contract has gained by $0.32/bbl on the day, to trade at $61.76/bbl at 09.00 GMT.

Upward pressure:

Brent has rebounded after the previous day’s losses, supported by renewed concerns over disruption to Venezuela-linked oil supply.

Earlier this week, the US Coast Guard seized an oil tanker off the coast of Venezuela, that regularly transported US-sanctioned oil on behalf of Venezuela and Iran.

The news has marked a major escalation in geopolitical tensions between the two countries “and threatens up to 560kb/d [560,000 b/d] of crude oil exports,” ANZ Bank’s senior commodity strategist Daniel Hynes said.

Washington is preparing to intercept more vessels carrying Venezuelan oil, Reuters reported citing sources. “Shippers may become reluctant to load Venezuelan cargo,” Hynes added.

Downward pressure:

Brent’s price has come under some downward pressure following statements from Ukraine’s President Volodymyr Zelensky, according to market analysts.

“He [Zelensky] indicated that the United States wants to understand the status of peace proposals by Christmas, but clarified that there is no firm deadline set by the US regarding these proposals,” remarked Price Futures Group’s senior market analyst Phil Flynn.

Besides, leaders from France, Germany and the UK held a telephone call with US President Donald Trump this week, to discuss efforts to end the four-year long conflict in Ukraine.

A peace deal between Russia and Ukraine could ease global sanctions on Russian energy and bring sanctioned oil volumes back to the market, according to analysts.

By Nachiket Tekawade and Aparupa Mazumder

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