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BUNKERWORLD INDEX: Prices dip amid soft crude outlooks
19th March 2021 14:23 GMT

 

The BW 0.5%S Index ended March 18 at $510/mt, a decrease of $11/mt on the day and of $15/mt on the week, but up $10/mt from 30 days previously.

The BW380 Index, which represents value for 3.5%S fuel oil, ended the day at $411.00/mt, which was $7.50/mt lower on the day and $9.50/mt lower on the week, but still $18.50/mt higher than 30 days previously.

In global crude oil markets, prices saw downward corrections this week which analysts said was overdue given the lingering concerns over demand returning from COVID-19.

This follows OPEC lowering its oil demand forecast for Q1 and Q2 by 180,000 b/d and 310,000 b/d, respectively, in its closely watched Monthly Oil Market Report released on March 11.

In the tanker markets, lackluster demand for oil and rising bunker fuel expenses continued to squeeze tanker owners’ earnings in Q1 2021, but with the rollout of vaccines now well underway, ton-mile demand could start drawing support from greater mobility in Q2 as countries reduce lockdown measures. Smaller ship sizes are expected to benefit first from any increase in demand.

The direction of flat prices in the ensuing days notwithstanding, bunker demand in Singapore was likely to remain steady, much as it has been for most part of the week ending March 19, traders said.

On an ex-wharf basis though, demand to conclude deals for product loading in the second half of March was said to be thin as compared to buying interest observed in the first half, said traders.

In Fujairah, the premium for low sulfur marine fuel, which had soared to multi-month highs over the course of the week ended March 19, was likely to edge lower in the near term, said traders.

A tight availability situation was likely to ease in the near term on expectations of a pick-up in the volume of oil that Uniper would be able to load out from its terminal, traders said.

"Yes, they've started loading out oil, but it's still only in parts and in smaller quantities," a Fujairah-based supplier said on March 19.

As such, there still weren't more than just a few suppliers in a position to offer product deliverable prior to March 26, traders said on March 19.

The premium for Fujairah-delivered marine fuel 0.5%S bunker over FOB Singapore marine fuel 0.5%S cargo has surged to end the trading week at a 13-month high of $50.47/mt on March 19.

In Europe, loading delays for HSFO in Amsterdam-Rotterdam-Antwerp region were expected to ease in the coming days after poor weather conditions the week previous led to delays in blending capacities, sources said.

Bunkers markets throughout the Americas will keep their attention on global crude indicators in the wake of recent steep declines, with attention also being paid to resupply operations on the wholesale side in Houston.

Sources in Panama have recently pointed to limited supply options for exports out of Houston, while in New Orleans issues on the bulk side and with congestion have propped up retail premiums in recent weeks.

The BW Indexes are weighted daily indexes made up of assessments at 20 key bunkering ports. To obtain a representative geographical spread, the ports were selected by size with reference to their geographical importance.

The BW0.5%S Index ports are Hong Kong, South Korea, Shanghai, Singapore, Japan, Las Palmas, Durban, Fujairah, Gibraltar, Piraeus, Rotterdam, St. Petersburg, Houston, Los Angeles, New York, Balboa and Santos.

The BW380 Index ports are Busan, Canary Islands, Colombo, Durban, Fujairah, Gibraltar, Hong Kong, Houston, Los Angeles, New York, Offshore Nigeria, Panama Canal, Piraeus, Rotterdam, Santos, Shanghai, Singapore, St. Petersburg, Suez and Tokyo.

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Bunkerworld .,
19th March 2021 14:23 GMT