LSFO supply disruptions at Fujairah pushes bunker spread against Singapore to all-time high
3rd August 2022 12:41 GMT

 

Platts Fujairah-delivered marine fuel 0.5%S bunker spread against Singapore cargo values surged to a fresh all-time high of $75/mt on Aug. 3, S&P Global Commodity Insights data showed, as operational bottlenecks exacerbated supply tightness at the Middle Eastern bunkering hub of Fujairah.

 

Platts started assessing delivered marine fuel 0.5%S at both ports on July 1, 2019.

“Due to the uncertainty with regards to the availability of oil since the severe flooding in Fujairah [which resulted in] all terminals facing difficulties, I will not be offering till we are confident [of obtaining supplies],” a Fujairah-based bunker supplier said on Aug. 3.

Offers were retracted despite steady inflows of low sulfur fuel oil bunker inquiries as terminal closures sparked uncertainty among local suppliers, thus elevating bunker premiums, local traders said.

Platts Fujairah-delivered marine fuel 0.5%S bunker premiums over benchmark FOB Singapore Marine Fuel 0.5%S cargo assessments climbed to average $125.74/mt during the first two trading days of August, compared with $102.48/mt in July, S&P Global data showed.

“Considering the recent weather, we are unclear on market availabilities and would not be able to offer," a Fujairah-based trader said Aug. 3. "There is no news from the terminal yet,” he added, indicating that terminal loadings remain suspended indefinitely.

An additional eight to 10 days of operational delays would be likely as terminal loadings for barges in queue for refueling have reportedly yet to resume, with suppliers also extending LSFO deliveries up to the second half of August, sources said.

“The market is still awaiting confirmation from the terminals for LSFO loadings, before quoting firm offers. The current situation is not good,” a second Fujairah-based bunker supplier said Aug. 3.

Platts Fujairah-delivered marine fuel 0.5%S bunker price spread against Singapore averaged $60/mt over Aug. 1-2, compared with minus $1.60/mt in July and minus $1.77/mt in June, S&P Global data showed.

 

 

Softening Asian downstream market lifts demand in Singapore

 

Increasing LSFO supplies at the world’s largest bunker hub of Singapore gradually eased bunker premiums, which drew demand since late July, traders said.

LSFO cargo availabilities is expected to improve in August from the low stockpile in July, local traders said.

“Recently, the flat price has come off and that helped to support LSFO [bunker] demand,” a Singapore-based bunker supplier said. “However, this trend is subjected to prices at neighboring ports too.”

Platts Singapore-delivered marine fuel 0.5%S bunker premiums over FOB Singapore Marine Fuel 0.5%S cargo assessments slid to average $65.74/mt over Aug. 1-2 from $104.08/mt in July, S&P Global data showed.

Amid the improving LSFO supply situation, barge availability is reportedly limited for prompt bunker deliveries owing to loading congestions at terminals around Singapore, according to local bunker suppliers Aug. 3.


Bunkerworld ,
3rd August 2022 12:41 GMT