Europe & Africa Market Update 19 Dec

Bunker fuel prices in major European and African ports have moved in mixed directions, and VLSFO is quicker to source than HSFO in Durban.

IMAGE: Aerial view of Durban port landscape. Getty Images

Changes on the day to 09.00 GMT today:

• VLSFO prices unchanged in Rotterdam, and down in Durban ($27/mt) and Gibraltar ($2/mt)
• LSMGO prices down in Gibraltar ($17/mt) and Rotterdam ($15/mt)
• HSFO prices up in Durban ($3/mt), and down in Gibraltar ($15/mt) and Rotterdam ($2/mt)
• Rotterdam B30-VLSFO premium over VLSFO down $3/mt to $237/mt
• Gibraltar B30-VLSFO premium over VLSFO down $3/mt to $377/mt

Durban’s VLSFO price has seen the biggest fall among the three major ports, with a lower-priced 150-500 mt stem fixed at $480/mt exerting downward pressure on the benchmark.

Consequently, Durban’s VLSFO premiums over Gibraltar and Rotterdam have fallen by $25–$27/mt in the past session.

The HSFO price in Durban has edged higher, and the port’s Hi5 spread has narrowed by $30/mt to $21/mt in a single session.

VLSFO supplies are quicker to secure in the South African port, with a notice of 2-4 days, while HSFO deliveries may need around a week of lead time, a trader said.

Rough winds of more than 30 knots and waves of over 2 metres are forecast between 22-23 December in Durban, which could lead to suspension of bunkering operations.

Brent

The front-month ICE Brent contract has dropped by $0.29/bbl on the day, to trade at $59.74/bbl at 09.00 GMT.

Upward pressure:

Brent crude’s price has found some support on the back of fresh economic data from the world’s largest crude oil consumers – the US.

The US Consumer Price Index (CPI), a key gauge of inflation, increased by 0.2% in both October and November, after rising by 0.3% in September.

The data supports the likelihood of further US interest rate cuts in 2026, according to market analysts.

Lower interest rates in the US can support demand growth and make dollar-denominated commodities like oil less expensive for holders of other currencies.

Downward pressure:

Growing optimism over a potential Russia-Ukraine peace agreement has offset supply disruption concerns stemming from the blockade of Venezuelan oil tankers.

US President Donald Trump said talks aimed at ending the conflict in Ukraine are “getting close to something,” Reuters reported.  

The remarks come ahead of a meeting between US and Russian officials over the weekend.

Market analysts believe that a deal could potentially ease energy-related sanctions on Kremlin, bringing Russian oil back to a global market already facing oversupply concerns.

“Current US sanctions on Russian oil companies are having an impact on oil exports, with volumes falling below 400kb/d [400,000 b/d] to India and 600kb/d [600,000 b/d] to China,” ANZ Bank’s senior commodity strategist Daniel Hynes said.

By Nachiket Tekawade and Aparupa Mazumder

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