The 0.5% sulfur fuel oil market at the Northwest European bunker hub at Rotterdam has risen to its highest point since early March, mainly on the back of strength in the broader oil complex but helped by a pick-up in activity with COVID-19 lockdowns being eased, sources said.

“Locally, [European] demand is picking up as well, and margins start to find some color,” one source said.

Fuel oil participants remained cautious, as supply remained ample in the region and globally.

S&P Global Platts assessed 0.5%S delivered fuel oil at Rotterdam at $298.00/mt on June 19, with 0.5%S fuel oil barges at $289.50/mt. That was the highest point for the bunker assessment since March 10 and since March 6 for barges.

Despite the rise in bunker prices, demand at Europe’s largest bunker hub in Rotterdam was moderate at best, suppliers said, as fundamentals continued to weigh on demand.

That said, VLSFO FOB Rotterdam barge cracks have seen a marked recovery since the height of the coronavirus pandemic in Europe, from lows of 63 cents/b at the end of May to $4.13/b on June 19. However, that was still below pre-coronavirus levels which averaged $11.37/b in February.

Combined stocks of fuel oil in the Amsterdam-Rotterdam-Antwerp hub fell 11% to 1.521 million mt in the seven days to June 17, the second week of declines and its biggest drop in two months, according to data from Insights Global.

One source pinned that decline on the softening 0.5%S marine fuel contango rather than any uptick in demand, with weakening storage economics causing many to release barrels from storage.

Looking ahead, container shipping group Maersk has revised up its guidance for volumes transported in the second quarter to a fall of 15%-18%, rather than the 20%-25% estimate in its previous guidance.

Some reservations remained, however. "Given the uncertainty on demand recovery in the second half of 2020 as economies are still impacted by COVID-19, the full-year guidance on earnings remains suspended," the company said.