Rotterdam delivered bunker fuel premium to HSFO barges highest in 11 weeks
Rotterdam delivered bunker fuel’s premium to ex-wharf material has hit an 11-week high, with volatility in the ARA bunker market resulting in a widening range between 380 CST delivered prices and weak HSFO barges, sources said.
The delivered Rotterdam 380 CST high sulfur bunker fuel premium to ex-wharf was assessed at $9/mt Thursday, the widest since April 1, S&P Global Platts data showed.
On an outright price basis, Rotterdam 380 CST HSFO was assessed down $6/mt at $217.50/mt, while 3.5% FOB Rotterdam fuel oil barges fell $8.25/mt to $208.50/mt.
“The bunker price is highly sensitive to shifting crude values, as was the case Thursday,” one trader said.
Meanwhile, the 3.5% FOB Rotterdam barge market has experienced continued weakness since the beginning of the month amid a closed arbitrage east, even amid relatively low freight rates, that has resulted in a growing stockpile of finished specification fuel oil.
“There is a lot of RMG around. Sellers are willing to give discounts if we buy at the front end,” said one trader. “Buying interest in the Asian cash market is weak, especially on the Singapore forward curve.”
A second trader said: “Inventories in Singapore are…at year-highs”.
Just one VLCC has been fixed to carry product to Asia this month, sources have said, compared with a typical 4-5 per month.