Europe & Africa Market Update 23 Oct

Bunker prices in major European and African ports have moved in mixed directions, while fuel availability is tight in the South African ports of Durban and Cape Town.

IMAGE: Aerial view of Durban port landscape. Getty Images

Changes on the day to 09.00 GMT today:

• VLSFO prices up in Rotterdam ($2/mt) and Gibraltar ($1/mt), and down in Durban ($28/mt)
• LSMGO prices up in Durban ($34/mt) and Rotterdam ($8/mt), and down in Gibraltar ($4/mt)
• HSFO prices up in Gibraltar ($1/mt), and down in Rotterdam ($9/mt) and Durban ($4/mt)
• B30-VLSFO price up in Rotterdam ($17/mt)

Durban’s VLSFO price has dropped significantly over the past day. The grade's price has been falling, decreasing around $76/mt in the last two weeks.

Conversely, the port's HSFO price has gained $56/mt over the last two weeks. As a result, the Hi5 spread has narrowed around $132/mt.

Despite recording a decline, Durban’s VLSFO price still continues to trade at a $132/mt price premium over Cape Town, and a $93/mt premium over Port Louis.

Fuel availability is tight in Durban and Cape Town, and buyers are recommended lead times between 10-15 days for securing deliveries, a trader told ENGINE.

Strong south-westerly wind gusts of more than 25 knots and swells higher than 2 metres are forecast in Durban on Sunday, which could disrupt some bunkering operations in the port area.

Brent

The front-month ICE Brent contract has risen by $1.36/bbl on the day, to trade at $113.73/bbl at 09.00 GMT.

Upward pressure:

Brent futures have extended their gains from Thursday as concerns over supply disruptions in the Middle East continue to mount.

Saudi Arabia’s state-owned oil company Aramco has told its staff to evacuate the company’s headquarters in Dhahran, as fighting between Saudi forces and Yemen-based Houthis has intensified, Reuters reported.

“Reports suggest President Trump is considering fresh strikes on Iran, while the US is reinforcing its military presence in the region with the deployment of a second aircraft carrier,” analysts from ING Bank said.

Meanwhile, Iran has threatened to strike oil and AI facilities across seven Gulf countries if the US and Israel launch fresh attacks on Iran, The Guardian reported, citing Iran’s National Security Council secretary Mohsen Rezaei.

Downward pressure:

Brent’s price has come under some downward pressure following reports that Russia agreed on Wednesday to participate in US-mediated peace talks with Ukraine, starting next month.

Additionally, an oil tanker carrying 40,000 mt of Russian diesel is heading towards New York, Reuters reported. The move follows US President Donald Trump's announcement of the diesel purchase deal with Russian President Vladimir Putin on 9 October.

By Nachiket Tekawade and Shilpa Sharma

Please get in touch with comments or additional info to news@engine.online