Bunker Prices Outlook, Week 12

In the first quarter 2021, demonstrated firm upward evolution: the growth of MABUX HSFO 380 Global Index averaged plus 59.94 USD/MT, MABUX VLSFO Global Index – plus 67.80 USD/MT and MABUX MGO Global Index – plus 84.50 USD / MT.

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Global MABUX SS spread (the difference in price between 380 HSFO and VLSFO) in 1Q 2021 showed a steady recovery to the levels of the beginning of 2020 and averaged 99.62 USD versus 53.49 USD in 3Q 2020 and 62.35 USD in 4Q 2020. The steady widening of the SS spread has brought back the relevance of scrubbers’ solution, especially in the segment of large-capacity vessels.

As for the week 12, MABUX World Bunker Index has turned into a firm downward movement, following the correction trend on the global oil market. 380 HSFO index fell by 15.70 USD: from 426.52 USD/MT to 410.82 USD/MT, VLSFO Index decreased by 23.62 USD: from 530.76 USD/MT to 507.14 USD/MT, while MGO Index lost 20.42 USD (from 605.88 USD/MT to 585.46 USD/MT). The Global Scrubber Spread (SS) also showed a moderate decline and dropped below the $ 100 mark again: 98.79 USD versus 104.27 USD last week.

SS spread in Rotterdam continued narrowing during the week, this time from 91.00 USD to 88.00 USD, however, the average SS spread decreased more significantly: by 8.50 USD from 99.33 USD last week to 90.83 USD. In Singapore, the SS index also showed a further reduction of price difference between 380 HSFO and VLSFO by USD 18.00: from USD 109.00 to USD 91.00, while the average SS index dropped by USD 12.83: from 112, 00 USD last week to 99.17 USD. Despite the fact that SS spread index in two biggest hubs is below the $ 100 mark at the moment, this is most likely a temporary phenomenon linked to the correction on the global fuel market, and SS spread still has growth potential.

Correlation of MBP Index (Market Bunker Prices) vs DBP Index (MABUX Digital Benchmark) in the four global largest hubs during the past week showed that 380 HSFO fuel was underсharged in three selected ports ranging from minus $ 2 (Fujairah) to minus $ 19 (Rotterdam). In Houston, there was a 100-percent correlation between the MBP and DBP Indexes. DBP Index also registered an underpricing of VLSFO in two of the four selected ports: Rotterdam – minus $ 9 and Singapore – minus $ 21. Fujairah and Houston recorded an average overcharging of VLSFO by $ 11 and by $ 27, respectively. MGO LS, according to DBP Index, was undervalued in Rotterdam (minus $ 43) and Singapore (minus $ 40). In Fujairah and Houston, this type of fuel was overpriced by $ 4 and $ 23, respectively.

Samples tested by FOBAS in recent weeks in ARA have shown Total Sediment Potential (TSP) results exceeding the 0.1% m/m ISO 8217 specification limit. According to FOBAS, the TSP results ranged up to 0.35% m/m. The fuel testing agency highlighted that fuels with high sediments can result in excessive sludge deposition in tanks and throughout the handling and treatment/fuel injection systems.

Source: www.mabux.com

Source: MABUX

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