The following article regarding regional bunker fuel availability outlook for the East of Suez region has been provided by online marine fuels procurement platform ENGINE for publication on Singapore bunkering publication Manifold Times:
- VLSFO and HSFO availability tight in Singapore
- Bunker demand low in Zhoushan
- Availability good across all grades in South Korean ports
Singapore and Malaysia
In Singapore, the availability of VLSFO remains tight due to increased demand. Several suppliers have recommended lead times ranging between 5-10 days for the grade, similar to last week. HSFO availability is also under pressure, with lead times advised at 8-14 days. LSMGO requires a shorter lead time of 2-5 days.
Residual fuel oil stocks in Singapore have averaged 6% lower in the first two weeks of March compared to February, according to Enterprise Singapore. Net fuel oil imports have decreased by 25% so far in March, with a record decline of 848,000 bbls. Fuel oil exports have increased by 203,000 bbls, contributing to the stock draw.
On the other hand, middle distillate stocks in the port have averaged 17% higher this month, reaching multi-year highs.
In Malaysia’s Port Klang, VLSFO and LSMGO availability remains good, with lead times projected at around 3-5 days. Smaller parcel sizes can be even more quickly delivered, according to a source. HSFO supply remains constrained in Port Klang.
China and East Asia
In China’s Zhoushan port, all bunker grades are readily available, with recommended lead times of 2-5 days, similar to the previous week. Overall, bunker demand in the Chinese bunker hub remains sluggish.
In north China, VLSFO and LSMGO availability have improved in Dalian, whereas Tianjin faces tightness across all fuel types. Qingdao has good availability of VLSFO and LSMGO, but HSFO availability depends on enquiry. In the southern port of Shanghai, VLSFO and LSMGO availability have improved, but HSFO remains subject to enquiry. In Fuzhou, Yangpu, and Xiamen, both VLSFO and LSMGO are abundantly supplied. However, low-sulphur fuel grades remain scarce in Guangzhou.
In Hong Kong, availability of all bunker grades remains good. Most suppliers recommend lead times of 3-5 days, down from approximately seven days last week.
In South Korean ports, bunker demand remains slow due to higher prices compared to regional ports. Busan’s VLSFO premiums over Zhoushan and Singapore were $20/mt and $12/mt, respectively, on Tuesday. Availability across all grades has improved in South Korean ports, with several suppliers advising lead times of 3-4 days, a decrease from 3-9 days last week. However, there are forecasts of high winds and waves intermittently this week, which could affect bunkering in ports such as Ulsan, Onsan, Busan, Daesan, Taean, and Yeosu.
In Japan, bunker demand remains subdued. Lead times vary across key Japanese ports, ranging from 5-8 days in Tokyo, Chiba, Osaka, and Kobe, to longer periods of 11-15 days in Nagoya, Yokkaichi, Mizushima, and Oita.
Adverse weather conditions are expected in Subic Bay (Philippines) on 21 March, Hai Phong (Vietnam) on 23 March, and intermittently in Ho Chi Minh (Vietnam) between 20-21 March, potentially causing challenges for bunker deliveries.
South Asia
Many ports across India, including Kandla, Chennai, Visakhapatnam, and Haldia, are facing supply challenges due to shortages of VLSFO and LSMGO. Cochin and Paradip are particularly impacted, with some suppliers nearing depletion of their VLSFO and LSMGO stocks.
Intermittent adverse weather conditions are forecasted throughout the week at the Indian ports of Sikka and Kandla, potentially causing disruptions to bunkering operations.
Middle East
Numerous shipping firms continue to avoid the Red Sea route due to persistent attacks by Houthis on commercial vessels. Instead, they are choosing the longer journey around Africa, bypassing the shorter Suez Canal route. This change in shipping routes is gradually affecting bunker fuel demand in Fujairah.
Fujairah sold 623,000 mt of bunkers in the shorter month of February, down by 6% from 664,000 mt in January, according to data compiled by Fujairah Oil Industry Zone (FOIZ) and S&P Global Commodity Insights.
Prompt availability remains tight in the UAE port of Fujairah amid product loading delays at oil terminals. Intermittent weather disruptions in recent weeks have led to barge product loading delays at terminals, a trader says. Overall, bunker demand has been slow in the port. Many suppliers are recommending lead times of 7-10 days for all bunker fuel grades, unchanged from last week. But smaller parcel sizes can be secured with shorter lead times, a source says.
Supply constraints in the UAE port of Khor Fakkan persist as well, with most suppliers advising similar lead times of 7-10 days.
In the port of Jeddah in Saudi Arabia, both VLSFO and LSMGO remain readily available. In nearby Djibouti, some suppliers are experiencing shortages of VLSFO, although LSMGO supply remains normal.
Meanwhile, the Omani ports of Sohar, Salalah, Muscat, and Duqm have abundant supplies of LSMGO, with prompt availability.
By Tuhin Roy
Photo credit and source: ENGINE
Published: 20 March 2024