Bunker fuel prices outlook – week 37

On a Week 37, the MABUX World Bunker Index showed moderate growth. The 380 HSFO index rose by 10.95 USD: from 457.20 USD / MT to 468152 USD / MT, the VLSFO index increased by 12.38 USD: from 552.45 USD / MT to 564.83 USD / MT, while the MGO index added 8.31 USD (from 650.13 USD / MT up to 658.44 USD / MT).

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MABUX ARA LNG Bunker Index, calculated as the average price of LNG as a marine fuel in the ARA region, turned into a moderate decline over the Week 37 from 1062.42 USD / MT to 1058.30 USD / MT (minus 4.12 USD). At the same time, the average LNG Bunker Index increased by 21.85 USD compared to the previous week (1059.43 USD/MT versus 1037.58 USD/MT). The MGO LS average price in Rotterdam for the same period increased by 15.00 USD / MT, and the average price difference between bunker LNG and MGO LS in Rotterdam gained 17.85 USD, approaching the 500 USD mark: (472.10 USD/MT versus 454.25 USD/MT last week). Prices for LNG as a bunker fuel in the ARA region continue to rise amid uncertain prospects for the Nord Stream 2 pipeline, limited LNG supplies to Europe and limited pipeline gas supplies from Norway and Russia, and low gas storage levels in Northern Europe. LNG bunker price indices are available in the LNG Bunkering section on www.mabux.com.

The average weekly Global Scrubber Spread (SS) – the price difference between 380 HSFO and VLSFO – remained virtually unchanged during the week at $ 95.00 (versus $ 94.43 last week). Meantime, the average value of SS Spread in Rotterdam stays stable above the $ 100 mark: $ 109.83 (vs. $ 108.00 last week, plus $ 1.83). Noteworthy is the continuing decline of average weekly SS Spread in Singapore: $ 83.67 versus $ 90.17 last week (minus $ 6.50).  More information is available in the Differentials section on the website www.mabux.com.

Correlation of MABUX MBP Index (Market Bunker Prices) vs MABUX DBP Index (MABUX Digital Benchmark) in the four global largest hubs over the past week showed that 380 HSFO fuel grade was overvalued in all selected ports. The minimum overprice ratio was recorded in Rotterdam (plus $ 3) and Houston (plus $ 7), the highest – in Singapore (plus $ 46).

VLSFO fuel, grade, according to the MABUX MBP / DBP Index, was also overcharged at all selected ports with trough levels in Houston (plus $ 7) and Rotterdam (plus $ 8). In Singapore and Fujairah, VLSFO overpricing was plus $ 17 and plus $ 18, respectively.

MGO LS remains the only fuel grade that, according to MABUX MBP / DBP Index, was underpriced at all selected ports on Week 37: the minimum margin in Houston (minus $ 4) and the maximum – in Singapore (minus $ 30).

A new report from Lloyd’s Register (LR) has called for ‘immediate action on maritime decarbonisation’ in order to prevent future supply chain interruptions and minimise disruption to the ‘backbone of world trade’.  LR pointed out that transition to zero-carbon shipping will be ‘among the most significant in the sector’s history’ and warned that a lack of regulatory certainty and support from policymakers could see a rushed and uncoordinated transition, potentially leading to significant supply chain disruption. The LR study found consensus among maritime experts that shipping companies, their customers, and governments, need to work together on global solutions before the urgency of the climate crisis forces the sector into disruptive and fragmented changes. The report also flagged up the importance of infrastructure and the availability of the new alternative shipping fuels.

Source: MABUX