Bunker benchmarks in most European and African ports have gone up with Brent, and Rotterdam’s Hi5 spread has widened. 

PHOTO: Ships docked in the Port of Las Palmas, Gran Canaria, Spain. Getty Images

Changes on the day to 09.00 GMT today:

• VLSFO prices up in Rotterdam ($9/mt), Gibraltar ($6/mt) and Durban ($2/mt)
• LSMGO prices up in Rotterdam ($5/mt) and Gibraltar ($4/mt), and down in Durban ($16/mt) 
• HSFO prices unchanged in Rotterdam, and down in Gibraltar ($2/mt)

Several stems have been booked in Rotterdam in the past session. Three HSFO stems have been booked in the port since yesterday. Of which, two lower-priced stems for non-prompt delivery have supported the benchmark's resistance against Brent's upward push and held steady in the past day.

Unlike its HSFO, Rotterdam's VLSFO price has gained some in the price day to widen the port's Hi5 spread by $9/mt to $129/mt now. Three LSMGO stems were fixed in Rotterdam in a $773-787/mt price range yesterday, of which two higher-priced stems have pushed the benchmark higher.

In Gibraltar, one higher-priced LSMGO stem was fixed at $874/mt (150–500 mt) in the past session for prompt delivery, which has supported the benchmark's gains. 

Gibraltar’s HSFO price has defied Brent’s upward pull and moved counter to the wider market direction. One 500-1,500 mt lower-priced HSFO stem booked at $548/mt yesterday at Gibraltar has dragged the port's HSFO price lower.

In the Canary Islands, a 150-500 mt lower-priced LSMGO stem was booked at $875/mt in Las Palmas yesterday. Las Palmas' LSMGO price is currently trading at near parity levels with Gibraltar's.

Brent

The front-month ICE Brent contract gained $0.42/bbl on the day, to trade at $90.07/bbl at 09.00 GMT.

Upward pressure:

After shedding some gains at the start of the week, Brent’s price has again risen above the $90/bbl mark amid heightened geopolitical tensions in the Middle East.

Iran launched over 300 drones and missiles on Israel over the weekend. “This marks an unprecedented and dangerous development in an already volatile region,” said Jorge León, senior vice president for oil market research at Rystad Energy. 

Oil market analysts are now closely monitoring Israel’s response to the recent attack as further escalation of the Middle Eastern conflict could expose “the crude oil market to further price hikes,” remarked SPI Asset Management’s managing partner Stephen Innes.

“Oil traders are now closely scrutinizing whether the recent Iran attack represents a ‘one-and-done’ scenario, a determination that will wield significant influence over financial [oil] markets,” he added.

Brent futures also gained after China reported stronger-than-expected gross domestic product (GDP) data for the first quarter of this year. The country’s GDP grew at a rate of 5.3%, Reuters reported. Positive GDP data shows that China’s economy is growing, which in turn could boost oil demand in the country.

Downward pressure:

China’s latest crude import data has weighed on Brent futures. On a daily basis, the country imported 11.55 million b/d of crude oil in March, down around 6% from 12.32 million b/d during the same time in 2023, market intelligence provider JLC reported.

The decline in imports has sparked concerns about weakening demand growth in China, which could prompt Brent futures to lose further upward momentum.

This “lacklustre” import figure has raised questions about China’s stimulus measures and its efficiency towards a complete post-COVID economic recovery, Innes said.

Besides, OPEC has ample spare capacity that can offset supply disruptions due to a broader geopolitical conflict in the Middle East, according to analysts.

“The market is comforted by the fact that OPEC has ample spare oil capacity ready should supply be disrupted,” argued ANZ Bank’s senior commodity strategist Daniel Hynes.

By Manjula Nair and Aparupa Mazumder

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