Europe & Africa Market Update 19 June

Bunker prices across major European and African ports have mostly gained, while prompt fuel availability is tight in South Africa's Durban.

IMAGE: Above view of Durban Harbour, South Africa. Getty Images

Changes on the day to 09.00 GMT today:

• VLSFO prices up in Rotterdam ($15/mt) and Gibraltar ($12/mt), and down in Durban ($50/mt)
• LSMGO prices up in Gibraltar ($17/mt), and down in Rotterdam ($27/mt)
• HSFO prices up in Gibraltar ($13/mt) and Rotterdam ($10/mt)
• B30-VLSFO prices up in Rotterdam ($33/mt) and Gibraltar ($23/mt)

Most bunker benchmarks in the three major regional ports have gained over the past day, tracking the rise in Brent's price.

Meanwhile, Durban’s VLSFO price has dropped significantly. Two 150-500 mt stems, fixed at low prices between $843-$880/mt, have weighed on the South African port’s VLSFO benchmark.

The price of VLSFO in neighboring bunker locations of Cape Town, off Walvis Bay and Port Louis have gained in line with the broader market.

Consequently, Durban’s VLSFO is now trading at a $90/mt discount to Cape Town.

On the contrary, despite recording a loss, Durban’s VLSFO is trading at premiums of $150/mt compared to Namibia's off Walvis Bay, and a $51/mt price premium to Mauritius’ Port Louis.

Prompt fuel availability is tight in the Durban, and buyers are advised to book around 5-7 days in advance to get delivery of any fuel grade, a trader told ENGINE.

Brent

The front-month ICE Brent contract has gained by $1.73/bbl on the day, to trade at $79.49/bbl at 09.00 GMT.

Upward pressure:

Brent’s price has moved higher after talks between US and Iran, to finalise the peace deal, got stalled.

Earlier this week, US President Donald Trump fast-tracked an interim agreement to cease all hostilities in the Middle East by physically signing the deal ahead of a state dinner in Versailles, France.

However, a formal signing ceremony between Washington and Tehran was planned to take place in Switzerland today, the White House had told earlier.

US Vice President JD Vance cancelled plans to travel to Switzerland, raising doubts about the viability of a lasting peace agreement, Reuters reported.

Israel has sidelined itself from the US-Iran deal after being left out of the talks, maintaining its offensive against the Hezbollah militant group in Lebanon – a stance that intensifies concerns regarding the agreement's long-term stability.

“Iran suspends start of nuclear talks over continued Israeli strikes on Lebanon,” VANDA Insights’ founder Vandana Hari remarked.

Downward pressure:

Brent crude’s price has remained below the $80/bbl mark as a partial normalisation of shipping through the Strait of Hormuz begins to alleviate the market's primary concern – potential disruptions to global crude flows.

Crude oil tankers stranded in the region are resuming transit, with around 10 million bbls exiting or moving through the strait, according to two analysts from ING Bank. “Kuwait is already signalling a gradual restart,” the two analysts said.

The current level remains largely below typical flows of around 20 million b/d, but the gap is expected to narrow as production recovers.

“Oil prices are on track for a sharp weekly decline, as shipping flows through the Strait of Hormuz begin to normalise and disruption concerns ease,” two analysts from ING Bank noted.

By Nachiket Tekawade and Aparupa Mazumder

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