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ENGINE: Europe & Africa Bunker Fuel Availability Outlook

02 Sep 2021

The following article regarding Europe and Africa bunker fuel availability outlook has been provided by online marine fuels procurement platform ENGINE for publication on Singapore bunkering publication Manifold Times:

2 September, 2021

VLSFO and LSMGO grades are widely available in Europe and Africa, while HSFO is in tight supply for prompt deliveries in certain ports this week.

Low sulphur fuels are generally readily available for prompt deliveries in major ports across Europe and South Africa. Lead times of 2-3 days are recommended for VLSFO and LSMGO stems in the ARA and Gibraltar Strait.

Not all suppliers in Rotterdam are able to quote combined VLSFO and LSMGO stems for prompt dates this week, however. Some are only able to deliver LSMGO for certain dates.

HSFO380 can be tight for prompt delivery dates in Skaw and some Mediterranean ports like Istanbul, while HSFO180 remains tight across South African ports.

Independent fuel oil inventories in the Amsterdam-Rotterdam-Antwerp (ARA) hub were down by 4% last week, bringing them to four-week lows of 7.57 million bbls.

Rotterdam’s forward curves for VLSFO and HSFO are in backwardation in the months to February next year. VLSFO September futures are priced around $20/mt higher than February, while the difference is larger for HSFO, at $30/mt.

Backwardated price structures typically disincentivises fuel storage, but weak arbitrage economics for cargo shipments from ARA to Singapore may have contributed to prop up ARA’s fuel oil inventories.

There was on average 230,000 bbls more fuel oil stored in ARA in August than in July.

The Gibraltar Strait, Canary Islands and Malta have calm weather forecast for the coming week and good access to stems with minimal bunker congestion.

Novorossiysk is set to have strong winds bordering on gale from Tuesday next week, which could disrupt bunkering then.

High swell has disrupted bunkering at anchorage in Algoa Bay in recent days. The swell is forecast to remain above 2.5 metres until Friday. This is normally the upper threshold for bunkering to go ahead at anchorage, according to shipping agent Sturrock Grindrod.

 

Photo credit: ENGINE
Published: 2 September, 2021

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