During the twelfth week of the year, the Marine Bunker Exchange (MABUX) global bunker indices experienced a consistent upward trajectory.
The 380 HSFO index climbed by US$11.49 to US$547.67/MT. Similarly, the VLSFO index saw a gain of US$15.95, reaching US$693.06/MT, nearing the US$700 threshold. Additionally, the MGO index surged by US$18.91 to US$914.15/MT, surpassing the US$900 mark.
“At the time of writing, there was no clear trend in the market,” stated a MABUX spokesperson.
The Global Scrubber Spread (SS), which indicates the price gap between 380 HSFO and VLSFO, experienced modest growth, rising by US$4.46 to reach US$145.39. Concurrently, the weekly average witnessed a US$2.08 uptick.
Conversely, in Rotterdam, the SS Spread decreased by US$5.00, dropping from US$126.00 to US$121.00, although the weekly average increased by US$4.16. In Singapore, the 380 HSFO/VLSFO price differential declined by US$9.00 to US$153.00, with the weekly average decreasing by US$10.67.
“Overall, SS Spread still does not have a firm trend, and we expect similar dynamics to persist next week,” commented a MABUX official.
According to Wood Mackenzie’s report, gas prices in Europe may plummet to as low as US$6.70 per million British thermal units (MMBtu) during the upcoming summer season due to a mild winter and ample gas inventories. The report notes a positive start to the year, with colder temperatures in Europe and a 12% year-on-year increase in industrial demand in January, followed by around a 6% rise in February. As Europe’s gas withdrawal season nears its conclusion, inventories reached 70.78 bcm on 10 March, showing a year-on-year increase of 5.61 bcm and surpassing the five-year average by 21.41 bcm.
It is expected that end-season inventory levels will surpass 68 bcm. Gas prices in Europe remain subdued, with the front-month Dutch Title Transfer Facility (TTF) dropping by US$2.114 per megawatt-hour (MWh) to settle at US$26,96/MWh on 11 March. This marks a 53% decrease year-on-year and an 81% drop compared to two years ago, following the Russia-Ukraine conflict.
Meanwhile, at the port of Sines in Portugal, the price of LNG as bunker fuel saw a moderate increase, reaching US$679/MT on 19 March, which is a rise of US$45 compared to the previous week. Additionally, the price gap between LNG and traditional fossil fuels widened on the same day, with LNG maintaining an advantage of US$242. On 19 March, MGO LS was quoted at US$921/MT in the port of Sines.
During Week 12, the MDI index, which compares market bunker prices (MABUX MBP Index) to the MABUX digital bunker benchmark (MABUX DBP Index), displayed the following trends across four selected ports: Rotterdam, Singapore, Fujairah, and Houston.
In the 380 HSFO segment, all four ports were in the undercharge zone. Rotterdam saw an 8-point widening in the average weekly underpricing, while Singapore narrowed by 3 points, Fujairah by 4 points, and Houston by 2 points. Notably, the MDI index in Fujairah remained above the US$100 mark.
Concerning the VLSFO segment, Rotterdam remained the sole undervalued port, with the average weekly ratio increasing by 7 points. The other three ports were in the overcharge zone. Singapore experienced a 12-point decrease, Fujairah a 13-point decrease, and Houston a 7-point decrease in average weekly margins. The MDI index in Houston approached the 100% correlation mark between market price and the MABUX digital benchmark.
In the MGO LS segment, Houston remained the only overpriced port, with the average weekly margin decreasing by 8 points. The other three ports were underpriced, with Rotterdam seeing a 13-point decrease, Singapore a 7-point decrease, and Fujairah a 2-point decrease in average weekly premiums. The MDI index in Rotterdam and Singapore approached the US$100 mark, slightly exceeding it.
The balance between undervalued and overvalued ports in the 380 HSFO, VLSFO, and MGO LS segments remained consistent throughout the week. There has not been a consistent trend observed in the MDI index yet.
