Europe & Africa Market Update 14 Oct

Bunker prices in European and African ports have mostly gained, while rough weather has disrupted bunkering operations off Malta.

IMAGE: Tankers during a bunker operation off Malta. Getty Images

Changes on the day to 09.00 GMT today:

• VLSFO prices up in Rotterdam ($20/mt), Gibraltar and Durban ($12/mt)
• LSMGO prices up in Durban ($21/mt), unchanged in Gibraltar, and down in Rotterdam ($35/mt)
• HSFO prices up in Rotterdam ($16/mt), Durban ($9/mt) and Gibraltar ($5/mt)
• B30-VLSFO price down in Rotterdam ($20/mt)

Bunker fuel prices have mostly gained over the past day, tracking the rise in Brent.

On the other hand, Rotterdam’s LSMGO price has dropped sharply, while Gibraltar’s LSMGO price remains unchanged. This has widened Gibraltar’s price premium over Rotterdam’s LSMGO by $35/mt in a single day.

Meanwhile, despite gaining $7/mt in the same time period, Malta's LSMGO is currently trading at a $27/mt price discount to Gibraltar. Also, Malta’s HSFO price is at a $77/mt discount to the HSFO offered at the Mediterranean port.

As an outlier, Malta’s VLSFO price is trading at a $14/mt price premium over Gibraltar's VLSFO price.

Wind gusts as strong as 25 knots are currently blowing off Malta. This has restricted all bunkering operations to Anchorage Area 4, port agent MH Bland said. As this is a small anchorage area, it is strictly limited to accommodating only 4-5 vessels for bunkering at the same time, the port agent added.

Fuel availability is tight for prompt supplies off Malta, and buyers are generally recommended a week's notice, a trader told ENGINE. That may change with weather conditions, the trader added.

Brent

The front-month ICE Brent contract has gained by $0.31/bbl on the day, to trade at $105.33/bbl at 09.00 GMT.

Upward pressure:

Brent crude’s price has found support after more vessels came under attack in the Strait of Hormuz, while Iran signalled it would step up its campaign against shipping.

A container ship and a tanker have been struck by unknown projectiles within the Strait of Hormuz since yesterday, the United Kingdom Maritime Trade Operations (UKMTO) agency reported.

“Iranian attacks on tankers transiting the Strait of Hormuz showed no signs of easing,” ANZ Bank’s senior commodity strategist Daniel Hynes said.

Iranian officials told Reuters they are deploying new tactics to target ships, in a bid to keep oil prices high and influence next month’s US midterm elections.

“According to data from the UK Maritime Trade Operations, 24 ships were hit in the two weeks to 11 October,” Hynes added.

An administrative building belonging to Saudi Arabia’s state-owned oil company Aramco in Dhahran was also attacked yesterday, causing a fire, Reuters reported citing the country’s energy ministry.

Downward pressure:

Brent’s gains have been capped by some signs of recovering oil flows out of the Persian Gulf.

The US Central Command (CENTCOM) said it had helped ship more than 19 million bbls of crude through the Strait of Hormuz yesterday.

Traders are also weighing the prospect of more diesel supply from Russia.

By Nachiket Tekawade and Aparupa Mazumder

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