Most regional bunker benchmarks have declined, and VLSFO supply is normal in the ARA hub. 

PHOTO: A large container ship moored in a commercial dock at night in Rotterdam. Getty Images

Changes on the day, to 09.00 GMT today:

• VLSFO prices up in Durban ($2/mt), and down in Rotterdam ($5/mt) and Gibraltar ($1/mt)  
• LSMGO prices up in Rotterdam ($5/mt), and down in Gibraltar and Durban ($1/mt)  
• HSFO prices down in Rotterdam and Gibraltar ($2/mt)

Rotterdam's VLSFO prices have decreased some in the past day and availability of the product is said to be normal in the ARA hub. A steeper fall in Amsterdam’s VLSFO price has flipped its premium over Rotterdam to a discount now. A lower-priced stem booked in Amsterdam for non-prompt delivery has pushed the port's benchmark down by $16/mt to $597/mt in the past day.

Two lower-priced LSMGO stems were booked in Antwerp in the past day, adding downward pressure on the benchmark. LSMGO supply is normal in the ARA region. Lead times of 4-5 days are recommended for VLSFO, while LSMGO requires shorter lead times of 3-5 days.

Rough weather is forecast in Gibraltar today with strong wind gusts of 21 knots. Bad weather conditions could complicate bunker deliveries there, a source says. Five vessels are waiting for bunkers in Gibraltar today, down from nine yesterday, the source adds. Bunker fuel availability is currently normal in Gibraltar, with most traders recommending lead times of 4-6 days for all three grades.

Eight vessels are due to arrive for bunkers in the nearby Ceuta port today, down from nine yesterday, says shipping agent Jose Salama & Co. One vessel is currently waiting to bunker at anchorage, down from two yesterday. Supplier delays have come down at anchorage from 6-8 hours yesterday to four hours today. 

Brent
The front-month ICE Brent contract gained $0.08/bbl on the day, to trade at $88.22/bbl at 09.00 GMT.

Upward pressure:

Brent futures inched higher after the US Energy Information Administration (EIA) reported a massive drop in crude stocks. Commercial crude oil inventories in the US dropped by 6.37 million bbls to 453.63 million bbls in the week ended 19 April, the EIA reported.

Tensions in the Middle East are expected to grow as Israel may soon launch further ground and air assaults on southern Gaza’s Rafah region, Reuters reported. This news has rekindled concerns about the spillover of the Middle Eastern conflict that could disrupt oil flows in the region, analysts said.

“An escalation in proxy conflicts could translate into increased shipping disruptions in the Red Sea, while a more direct conflict between these countries would likely result in large quantities of oil supply coming offline,” J. P. Morgan’s global market strategist Jack Manley said.

Downward pressure:

Despite the decline in US crude inventories, distillate stocks, which include diesel and gasoil, rose by 1.61 million bbls to 117 million bbls, the EIA reported.

Higher distillate stocks have sparked concerns about a slowdown in oil products demand and sluggish economic growth.

“A supportive 6.4m bbl [6.4 million bbls] stock drop reported by the EIA was offset by slowing end user demand for both gasoline and diesel,” Saxo Bank’s strategy team wrote in a client note.

By Manjula Nair and Aparupa Mazumder

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