Europe & Africa Market Update 13 Apr

Bunker benchmarks in European and African ports have increased over the weekend, while the disruption in Antwerp caused by an oil spill is gradually easing.

IMAGE: Bunkering of vessel in the Port of Antwerp. Port of Antwerp

Changes on the day from Friday to 09.00 GMT today:

• VLSFO prices up in Durban ($53/mt), Rotterdam ($35/mt) and Gibraltar ($11/mt)
• LSMGO prices up in Durban ($386/mt), Gibraltar ($99/mt) and Rotterdam ($70/mt)
• HSFO prices up in Rotterdam ($33/mt), Gibraltar ($28/mt) and Durban ($14/mt)
• B30-VLSFO price up in Rotterdam ($68/mt) and Gibraltar ($33/mt)

Bunker benchmark prices have gained over the weekend, tracking the gain in Brent's price.

Rotterdam’s LSMGO price has seen a much sharper gain compared to Antwerp’s LSMGO. As a result, Antwerp’s LSMGO is now trading at a small discount to Rotterdam’s LSMGO, compared to a significant premium seen on Friday.

Fuel availability in the ARA is stable, but buyers are advised to enquire with a lead time of around five days to get competitive offers from a wide range of suppliers, a trader said.

Meanwhile, clean-up operations proceed in the Scheldt River after an oil spill occurred during a bunkering operation on a container vessel in the Deurganck dock, the port authority of Antwerp-Bruges said today.

The first new container vessels entered the port on Sunday, and a number of berths are available in the Deurganck dock today, the update said.

The cleaning work in the port area is expected to take a few more days, the port authority added.

Brent

The front-month ICE Brent contract has gained by $4.84/bbl on the day from Friday, to trade at $102.76/bbl at 09.00 GMT.

Upward pressure:

Brent crude’s price has rallied as hopes of a Pakistan-mediated ceasefire deal between the US and Iran lost steam over the weekend, following 21 hours of failed peace negotiations in Islamabad.

The US Central Command (CENTCOM) will enforce a blockade on vessels entering and exiting Iranian ports today, it said earlier.

“Expectations of an end to this conflict were dashed after weekend talks ended without agreement,” ANZ Bank’s senior commodity strategist Daniel Hynes said.

Meanwhile President Donald Trump has signalled Washington’s plan to resume some military operations in Iran.

These measures will “restrict Iran’s ability to export oil and will exacerbate the supply disruptions the market is experiencing,” Hynes added.

Downward pressure:

Brent’s price has felt some downward pressure following firm US inflation data, as it dampens expectations of further interest rate cuts by the US Federal Reserve (Fed) this year.

The US inflation rate, based on the Consumer Price Index for all urban consumers (CPI-U), increased by 0.9% in March, higher than the 0.3% growth noted in February, according to the US Bureau of Labor Statistics (BLS).

On an annual basis, the US CPI advanced 3.3% last month – much higher than the 2.4% growth seen in February.

Higher interest rates in the US can weigh on demand growth and make dollar-denominated commodities like oil more expensive for holders of other currencies.

By Nachiket Tekawade and Aparupa Mazumder

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