Bunker benchmarks in most European and African ports have followed Brent’s upswing, and bunkering remains suspended in Gibraltar.

PHOTO: Nieuwe Maas and Erasmus Bridge in Rotterdam. Getty Images

Changes on the day to 09.00 GMT today:

• VLSFO prices up in Durban ($15/mt), Gibraltar ($7/mt) and Rotterdam ($6/mt) 
• LSMGO prices up in Durban ($29/mt) and Rotterdam ($3/mt), and down in Gibraltar ($4/mt) 
• HSFO prices up in Gibraltar ($6/mt), and down in Rotterdam ($1/mt)

Rotterdam’s HSFO price has countered the wider market direction and dipped slightly in the past day. A lower-priced prompt HSFO stem fixed in the port earlier today has contributed to drag the benchmark down. Meanwhile, a higher-priced VLSFO stem booked for prompt delivery in Rotterdam has pushed the port's benchmark higher. The diverging price moves have widened Rotterdam's Hi5 spread by $7/mt to $109/mt now. 

Gibraltar’s LSMGO price has decreased some in the past day. A lower-priced LSMGO stem booked in Gibraltar in the past day has weighed on the benchmark. This has narrowed Gibraltar’s LSMGO premium over Rotterdam by $7/mt to $79/mt now. 

Bunkering has been suspended in Gibraltar since Tuesday afternoon due to bad weather conditions. A window of calm weather this afternoon could enable bunker operations to resume in the port, before conditions deteriorate again tomorrow, a trader says. The weather is forecast to remain rough tomorrow and over the weekend, which could cause prolonged delays and bunker backlogs. Around 23 vessels are waiting for bunkers in Gibraltar today, almost double from 13 yesterday, a source says.

In nearby Algeciras, bunkering is suspended in the inner anchorages as well as the outer Delta anchorage due to bad weather, a source says. Deliveries are possible at the outer port limits (OPL), but subject to the harbour master's approval.

Brent

The front-month ICE Brent contract gained $1.37/bbl on the day, to trade at $86.57/bbl at 09.00 GMT.

Upward pressure:

Escalating tensions in the Middle East continue to support Brent price gains. The failure of a ceasefire agreement between Israel and Hamas has again raised concerns about possible oil flow disruptions in the region.

“The lack of a ceasefire deal between Israel and Hamas continues to keep tensions in the Middle East elevated,” ANZ Bank’s senior commodity strategist Daniel Hynes stated.

The oil market is eagerly awaiting the outcomes of the upcoming OPEC+ Joint Monitoring Ministerial Committee (JMMC) meeting scheduled for next week, where discussions on extending supply cuts for the remainder of the year are on the agenda.

“Supply side issues also remain in focus ahead of a meeting by the OPEC Joint Monitoring Ministerial Committee next week,” Hynes further remarked.

Downward pressure:

US commercial crude oil inventories rose by 3.17 million bbls to 448 million for the week ending 22 March, according to US Energy Information Administration (EIA) data released yesterday. The stock build was much smaller than the 9.3 million bbls build predicted by the American Petroleum Institute (API).

The gasoline stocks also rose by 1.30 million bbls to 232 million bbls, signalling lower demand in the US.

“A shocking build in crude supply might be a bit hard to shake off,” Price Futures Group’s senior market analyst Phil Flynn commented.

“Oil [Brent] traded under pressure… as a report from the American Petroleum Institute showed a substantial build in US inventories, against the market expectations for a drawdown," stated two analysts from ING Bank.

By Manjula Nair and Tuhin Roy

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