Most bunker benchmarks across European and African ports have moved upwards, and the congestion at Gibraltar has worsened.

IMAGE: Oil products tanker moored at the Port of Gibraltar. Getty Images

Changes on the day to 09.00 GMT today:

• VLSFO prices up in Gibraltar ($13/mt) and Rotterdam ($4/mt), and unchanged in Durban
• LSMGO prices up in Rotterdam ($9/mt), and down in Gibraltar ($3/mt)
• HSFO prices up in Rotterdam ($8/mt), Durban ($5/mt) and Gibraltar ($1/mt)
• Rotterdam B30-VLSFO premium over VLSFO down by $11/mt to $233/mt
• Gibraltar B30-VLSFO premium over VLSFO up by $4/mt to $244/mt

Most conventional fuel prices at Rotterdam, Gibraltar and Durban have gained in the past session, tracking brent’s considerable climb.  

Gibraltar’s HSFO price gain has been marginal compared to Rotterdam and Durban, as two lower priced 150-500 mt HSFO stems, fixed at $470/mt and $466/mt, put downward pressure on the benchmark.

Meanwhile, a steep increase in the port's VLSFO price has widened its Hi5 spread, in contrast to Rotterdam and Durban, where the spreads have narrowed.

Two lower priced 50-150 mt LSMGO stems, fixed at $746/mt and $742/mt, have contributed to the drop in Gibraltar's LSMGO price.

B30-VLSFO price has fallen $7/mt in Rotterdam, while the blend has surged $17/mt in Gibraltar. This has doubled Gibraltar’s premium over Rotterdam to $48/mt, from $24/mt.

Nine vessels are awaiting bunkers at Gibraltar, up from three yesterday, worsening congestion at the port, according to port agent MH Bland.

Weather conditions have improved off Malta, with bunkering Areas 3 and 4 now operational, according to the port agent

LSMGO availability is a bit tight off Malta, though securing prompt supplies is possible, while HSFO and VLSFO supply is normal, a trader said.

The price of LSMGO off Malta has declined $10/mt to $760/mt in the past session, weighed down by two lower priced 150-500 mt stems fixed at $722/mt and $743/mt.

Brent

The front-month ICE Brent contract has moved $1.75/bbl higher on the day, to trade at $72.23/bbl at 09.00 GMT.

Upward pressure:

Brent crude’s price has surged as market participants shift focus from oversupply concerns to the risk of a potential supply crunch in the coming months.

Supply crunch concerns stem from US President Donald Trump’s recent remarks indicating he may shorten Russia’s deadline to end the Ukraine conflict from 50 days to just 10–12 days.

“Failing to reach a deal risks additional sanctions on Russia and secondary tariffs on countries importing its oil,” said two analysts from ING Bank.

The warning follows additional sanctions by the EU and the UK, targeting Russia’s energy and shipping sectors.

“Russia exports more than 7m b/d [7 million b/d] of crude oil and refined products. Thus, effective 100% secondary tariffs would lead to a dramatic shift in the oil market,” the two analysts added.

Downward pressure

A build in US crude inventories has put some downward pressure on Brent futures.

US crude oil inventories rose by 1.54 million bbls in the week ending 25 July, according to estimates from the American Petroleum Institute (API).

A rise in US crude stocks can indicate lower demand for oil and weigh on Brent's price.

VANDA Insights’ founder Vandana Hari described the stocks data as “broadly stable.”

By Nachiket Tekawade and Aparupa Mazumder

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