Europe & Africa Market Update 12 June

Bunker prices across major European and African ports have dropped, while prompt fuel availability is tight in Las Palmas.

IMAGE: Ships docked in the Port of Las Palmas, Gran Canaria, Spain. Getty Images

Changes on the day to 09.00 GMT today:

• VLSFO prices down in Durban ($137/mt), Rotterdam ($41/mt) and Gibraltar ($38/mt)
• LSMGO prices down in Durban ($95/mt), Rotterdam ($61/mt) and Gibraltar ($53/mt)
• HSFO prices down in Gibraltar ($43/mt) and Rotterdam ($14/mt)
• B30-VLSFO prices down in Gibraltar ($65/mt) and Rotterdam ($63/mt)

Las Palmas’ LSMGO price has dropped around $76/mt in the past day, more sharply than Gibraltar’s benchmark. A low-priced 150-500 mt stem, fixed at $1,130/mt, in Las Palmas has put additional downward pressure on the benchmark.

This has narrowed Las Palmas’ LSMGO price premium over Gibraltar by $23/mt in a single day.

Prompt availability of all fuel types is tight in Las Palmas, with buyers advised to book around 7-10 days ahead, a trader told ENGINE.

However, deliveries at Las Palmas’ outer anchorages are currently halted due to rough sea conditions, MH Bland said. Deliveries can be carried out in the inner anchorage and at the berth, but with some delays due to limited space.

Meanwhile, in Gibraltar, ships calling for bunkers are seeing long queues, with around 19 vessels currently awaiting bunkers, and some suppliers are delayed around 24-48 hours on deliveries, port agent MH Bland said.

The port area is seeing rough winds of around 25 knots, prompting the Gibraltar Port Authority to issue a weather warning.

Brent

The front-month ICE Brent contract has declined by $5.67/bbl on the day, to trade at $86.54/bbl at 09.00 GMT.

Upward pressure:

Brent crude’s price has felt some upward pressure, following weekly US crude inventory reports that indicated a substantial decline.

Commercial US crude oil inventories decreased by 7.2 million bbls to 426.5 million bbls in the week ending 5 June, according to data from the US Energy Information Administration’s (EIA).

“This [EIA report] is the seventh consecutive week of declines,” two analysts from ING Bank noted.

The American Petroleum Institute (API) reported an even larger draw of 9.1 million bbls during the same week.

A decline in US crude stocks indicates tightness in the oil market and has put some upward pressure on Brent's price.

“Commercial [US] crude oil inventories stand at a little over 426m barrels [426 million bbls], around 5% below the seasonal 5-year average,” ING Bank’s analysts said.

Downward pressure:

Brent crude’s price has plunged by more than $5/bbl following remarks by US President Donald Trump, indicating that the time and place to sign a US-Iran peace deal will be “announced shortly”.

The US President said he is halting hostilities in the Middle East region as Washington prepares to announce that details regarding a potential US-Iran peace deal soon.

“There does appear to be more positive noise around the deal this time, not just from the US, but also from other parties involved in the negotiations,” ING Bank’s analysts said.

Saudi Arabia-led oil producers group OPEC has slashed oil demand growth forecast once again, as the ongoing conflict in the Middle East continues to reshape energy consumption patterns.

The Organization of the Petroleum Exporting Countries (OPEC) has cut its global oil demand growth projection for 2026 to about 1.0 million b/d – around 200,000 b/d lower than its previous estimate.

“Most other agencies forecast a contraction in demand this year amid supply disruptions in the Middle East,” ING Bank’s analysts added.

By Nachiket Tekawade and Aparupa Mazumder

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