Europe & Africa Market Update 15 July

Most regional bunker benchmarks have dropped significantly, and an accident has caused a disruption in traffic at Antwerp.

IMAGE: Huge container ship being unloaded with cranes at a container terminal in Antwerp, Belgium. Getty Images

Changes on the day to 09.00 GMT today:

• VLSFO prices down in Durban ($34/mt), Gibraltar ($27/mt) and Rotterdam ($20/mt)
• LSMGO prices up in Gibraltar ($9/mt), and down in Durban ($106/mt) and Rotterdam ($28/mt)
• HSFO prices down in Durban ($69/mt), Rotterdam ($12/mt) and Gibraltar ($2/mt)
• B30-VLSFO prices down in Gibraltar ($53/mt) and Rotterdam ($20/mt)

Most bunker benchmarks have dropped in the past day, tracking the drop in Brent price.

However, Gibraltar’s LSMGO price has edged $9/mt higher. A small stem of less than 50 mt, fixed at a high price of $1,294/mt, has provided upward support.

Consequently, Rotterdam’s price discount to Gibraltar has widened by $37/mt in a single session.

Bunker availability of all fuel grades is tight for prompt supplies, with buyers advised booking around 5-7 days ahead to get competitive offers from a wide range of suppliers, a trader told ENGINE.

A container of hydrofluoric acid was damaged and began leaking onboard container vessel Mia Summer II at the Deurganck Dock in Antwerp, leading to several workers becoming unwell.

Traffic in the affected area has been disrupted, which could lead to congestion in the port.

Brent

The front-month ICE Brent contract has declined by $2.52/bbl on the day, to trade at $84.68/bbl at 09.00 GMT.

Upward pressure:

Brent crude has continued to trade well above $80/bbl mark as tension in the Middle East remained fairly elevated.

Another commercial vessel came under attack while transiting the Strait of Hormuz, 13 nautical miles (NM) southeast of Limah, Oman yesterday, the United Kingdom Maritime Trade Operations (UKMTO) reported.

“Observable traffic in the strait [of Hormuz] all but ceased,” ANZ Bank’s senior commodity strategist Daniel Hynes said.

Earlier this week, a tanker was approached by six small boats about 50 NM south of Aden, Yemen. One small boat has fired warning shots, the UKMTO reported. “The other 5 small boats have remained at 1NM,” it added.

“The recent attacks on ships by both Iran and the US are making these journeys increasingly risky,” Hynes added.

Downward pressure:

Brent’s rally has lost some steam after US President Donald Trump cancelled plans to impose a 20% fee of a cargo’s value for the US to assist in safely transiting the Strait of Hormuz.  

Trump walked back from his previous comments, replacing the 20% “reimbursement fee” with trade deals with the various Gulf countries.

Oil broke above $85/bbl earlier this week after Trump proposed the fee and named the US “guardian of the Hormuz Strait.”

The US President did not disclose the specifics of the trade and investment deals that he claims Gulf nations will be striking with Washington.

Washington is signalling that “it is willing to compromise,” after Trump backed away from his latest plan, Hynes remarked.

By Nachiket Tekawade and Aparupa Mazumder

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