Benchmark bunker prices have moved in mixed directions in European and African ports, while prompt supply remains tight in the Gibraltar Strait.

IMAGE: Aerial view of Durban port landscape. Getty Images

Changes on the day, from Friday, to 09.00 GMT today:

• VLSFO prices up in Durban ($17/mt), and down in Rotterdam ($9/mt) and Gibraltar ($1/mt)
• LSMGO prices up in Gibraltar ($5/mt) and Rotterdam ($2/mt)
• HSFO prices down in Rotterdam, Durban ($4/mt) and Gibraltar ($2/mt)
• Rotterdam B30-VLSFO premium over VLSFO up by $8/mt to $265/mt
• Gibraltar B30-VLSFO premium over VLSFO down by $7/mt to $329/mt

HSFO and VLSFO prices have mostly declined across the three major ports over the weekend, except in Durban, where the HSFO price has dipped, but the VLSFO price has recorded a significant jump.

This has significantly widened the port’s Hi5 spread to $48/mt, compared to $27/mt on Friday.

Meanwhile, Durban’s premium over Gibraltar’s VLSFO price has increased by $18/mt over the weekend, while its premium over Rotterdam’s VLSFO has gained by $26/mt.

VLSFO is readily available in the South African port, with most suppliers able to deliver within 2–3 days, while HSFO supply remains tight, typically requiring at least a week’s lead time, a trader told ENGINE.

North-eastern winds above 25 knots and waves of more than 2.5 metres are forecast in Durban between 3-4 November, which could disrupt bunkering operations at the port.

Brent

The front-month ICE Brent contract has remained unchanged on the day from Friday, to trade at $64.66/bbl at 09.00 GMT.

Upward pressure:

Brent crude’s price has felt some upward pressure after official drilling figures showed a decrease in US oil rigs.

The total number of oil rigs fell by six over the week to 414, according to Baker Hughes.

The US oil rig count is seen as an indicator of future oil production. It reflects how much oil drilling activity is happening or expected to happen in the shale sector.

“The broader weakness in oil prices continues to weigh on drilling activity in the US,” two analysts from ING Bank noted.

Downward pressure:

OPEC+ has decided to continue with production hikes until the end of this year. This news has capped Brent’s price rise today.

Eight members of the group have agreed to collectively increase their production by another 137,000 b/d in December.

This marks the group's eighth consecutive plan to boost production. The move was “widely expected,” according to ING Bank’s analysts.

In an oversupplied market, any signal of increased future supply can put downward pressure on Brent’s price.

By Nachiket Tekawade and Aparupa Mazumder

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