Europe & Africa Market Update 26 Feb 2025

Bunker prices in key European and African hubs have tracked Brent’s downward movement and LSMGO remains dry in Durban. 

Changes on the day to 09.00 GMT today:

• VLSFO prices down in Durban ($16/mt), Rotterdam ($12/mt) and Gibraltar ($9/mt) 
• LSMGO prices down in Rotterdam ($23/mt) and Gibraltar ($8/mt)  
• HSFO prices down in Rotterdam ($14/mt) and Gibraltar ($5/mt)
• Rotterdam B30-VLSFO premium over VLSFO down by $5/mt to $221/mt

Rotterdam’s LSMGO price has fallen by a steep $23/mt in the past day due to downward pressure from a lower-priced LSMGO stem booked for prompt delivery. The price fall has outpaced Gibraltar’s LSMGO price drop, widening Rotterdam’s LSMGO discount to Gibraltar by $14/mt to $76/mt now. 

A lower-priced prompt delivery HSFO stem booked on Tuesday has dragged Rotterdam’s benchmark down by $14/mt. Gibraltar’s HSFO stem has dipped slightly in comparison. These price moves have widened Rotterdam’s HSFO discount to Gibraltar by $9/mt to $57/mt now. 

In Gibraltar, two vessels are waiting for bunkers today, said port agent MH Bland. Bunkering is also proceeding smoothly off Malta today, but strong wind gusts of 26 knots may disrupt bunkering tomorrow, said MH Bland. Malta's HSFO price has been trading at near-parity levels with Gibraltar's HSFO over the past week. Malta's HSFO is at a slight $3/mt premium over Gibraltar now, compared to a $17/mt premium last month.

Meanwhile, in the South African ports of Durban and Richards Bay, VLSFO availability continues to be very tight for prompt delivery, with recommended lead times of seven to 10 days. LSMGO supply is still dry in Durban in Durban.

Brent

The front-month ICE Brent contract has lost $1.79/bbl on the day, to trade at $72.97/bbl at 09.00 GMT.

Upward pressure:

Brent’s price found some support after the American Petroleum Institute (API) reported a small decline in US crude stocks.

Crude oil inventories in the US moved 640,000 bbls lower in the week that ended 21 February, according to API estimates.

The broadly followed US government data on crude oil stockpiles from the US Energy Information Administration (EIA) is due later today.

Downward pressure:

Brent's price came under pressure amid growing prospects of a ceasefire deal between Russia and Ukraine, which could end the three year-long conflict.

Oil investors are also waiting to see the potential impact of a minerals deal between the US and Ukraine.

The US and Ukraine have agreed on the terms of a draft deal on Ukraine’s vast minerals and natural resources, Reuters reports. The deal could be finalised later this week, Reuters adds citing US President Donald Trump.

This deal is expected to pave the way for increased US support for Kyiv, which seems highly crucial now as ceasefire talks have picked up pace.

Additionally, a ceasefire deal between Russia and Ukraine could see the US lifting its sanctions on Russian oil exports, which in turn could increase global oil supply, analysts said.

“This [deal] would take us a step closer to Russian sanctions being lifted, removing much of the supply uncertainty hanging over the market,” two analysts from ING Bank said.

By Manjula Nair and Aparupa Mazumder

Please get in touch with comments or additional info to news@engine.online