Europe & Africa Market Update 17 Apr

Bunker benchmarks at European and African ports have moved in mixed directions, while prompt supplies are challenging to secure at the Gibraltar Strait ports.

IMAGE: Aerial view of the Bay of Gibraltar. Getty Images

Changes on the day to 09.00 GMT today:

• VLSFO prices up in Durban ($45/mt), Rotterdam ($12/mt) and Gibraltar ($6/mt)
• LSMGO prices down in Gibraltar ($48/mt) and Rotterdam ($5/mt)
• HSFO prices up in Rotterdam ($7/mt), and down in Durban ($124/mt) and Gibraltar ($17/mt)
• B30-VLSFO price up in Rotterdam ($37/mt), and down in Gibraltar ($6/mt)

Gibraltar’s LSMGO price has fallen more sharply in the past session compared to Rotterdam’s LSMGO price. This has almost halved Gibraltar’s price premium over Rotterdam.

Multiple lower-priced offers, between $1300-$1350/mt, may have put downward pressure on the benchmark.

Gibraltar's HSFO price has also fallen, while the grade has gained in Rotterdam. This has narrowed Gibraltar’s HSFO price premium over the Dutch port by around $24/mt in a single session.

Fuel availability is tight in the Gibraltar Strait ports for prompt delivery dates, with buyers advised to enquire about stems with a lead time of around 7-10 days to get good coverage from of suppliers, a trader said.

Bunker demand is strong at Gibraltar, with around 59 vessels expected to call for bunkers between 17-25 April, shipping agent A Mateos & Sons said.

Brent

The front-month ICE Brent contract has gained by $1.13/bbl on the day, to trade at $97.45/bbl at 09.00 GMT.

Upward pressure:

Brent crude’s price is poised to end the week near $100/bbl as the Strait of Hormuz continues to remain closed indefinitely.

Earlier this week, the US Central Command (CENTCOM) said a blockade of Iranian ports has been fully implemented.

Iran reacted to the news with fresh threats of disrupting global shipping routes beyond the Strait of Hormuz, including the Persian Gulf, Gulf of Oman, and the Red Sea.

“Oil flows through the Strait of Hormuz remain largely cut off, which continues to tighten the oil market,” ING Bank’s head of commodities strategy Warren Patterson said.

Downward pressure:

US President Donald Trump said a deal between Washington and Tehran could be reached soon, capping some of Brent’s gains today.

Trump told reporters that Iran had agreed to a potential nuclear deal, signalling further rounds of talks between the two sides.

“We have a lot of agreement with Iran, and I think something is going to happen very positive,” Trump said.

“The futures market appears to be responding more to headlines over how the war may evolve, with hopes that we could see a resolution in the coming weeks,” Patterson added.

By Nachiket Tekawade and Aparupa Mazumder

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