In the 11th week of the year, there was a moderate decline in the Marine Bunker Exchange (MABUX) global bunker indices.
The 380 HSFO index dropped by US$2.43 to US$534.39/MT. Similarly, the VLSFO index saw a decrease of US$2.17, reaching US$676.01/MT, while the MGO index experienced a loss of US$2.77 to US$894.21/MT, consistently remaining below the US$900 mark.
“At the time of writing, the market was in a moderate upward trend,” stated a MABUX spokesperson.
The Global Scrubber Spread (SS) – the disparity in price between 380 HSFO and VLSFO – remained steady, registering a nominal decrease of US$0.31 to US$141.62. The weekly average also declined by US$8.05.
In Rotterdam, the SS Spread increased by US$10, climbing from US$117 to US$127, while the weekly average remained nearly unchanged, experiencing a slight uptick of US$0.84.
Conversely, in Singapore, the difference in price between 380 HSFO and VLSFO narrowed by US$17 to US$161, leading to a weekly average drop of US$23.33.
“Overall, the SS Spread showed minimal fluctuations without a distinct trend,
varying slightly in different directions,” noted a MABUX spokesperson.
There has been a downward trend in global spot gas prices, with European spot gas and Asian spot LNG prices decreasing from around US$10 per million Btu at the end of 2023 to US$9 by the end of January, further dropping to US$8 in late February 2024.
This decline might stimulate the demand for LNG cargoes, especially in LNG markets across Asia, Africa, and South America.
Meanwhile, the cost of LNG as bunker fuel at the port of Sines in Portugal, saw a slight decrease, reaching US$634/MT on 11 March, marking a reduction of US$1 compared to the previous week.
Additionally, the price gap between LNG and traditional fuel narrowed on 11 March, with LNG holding an advantage of US$221, as opposed to the US$277 difference observed a week earlier. On this mentioned date, MGO LS was priced at US$885/MT in the port of Sines.
During Week 11, the MDI index, which compares market bunker prices (MABUX MBP Index) to the MABUX digital bunker benchmark (MABUX DBP Index), showed the following trends in four key ports: Rotterdam, Singapore, Fujairah, and Houston.
In the 380 HSFO segment, all four selected ports continued to be undercharged. Rotterdam saw a decrease of 5 points in the average weekly underpricing, while Singapore, Fujairah, and Houston experienced drops of 22, 12, and 3 points respectively. The MDI index for Fujairah remained above the US$100 mark.
In the VLSFO segment, Rotterdam was the only undervalued port according to MDI. There was a further decrease of 7 points in the weekly average underpricing. However, the remaining three ports were overestimated, with Fujairah and Houston witnessing increases of 8 and 7 points respectively in the average weekly premium. The MDI index for Singapore remained unchanged.
Regarding the MGO LS segment, Houston continued to be the only port with overpriced rates, witnessing a decrease of 3 points in the average weekly margin. Conversely, the other three ports showed underpricing, with Rotterdam experiencing an increase of 8 points in the average weekly premium, Singapore rising by 7 points, and Fujairah decreasing by 3 points. Both Rotterdam and Singapore maintained MDI indices above the US$100 mark.
Throughout the week, the balance between undervalued and overvalued ports in the 380 HSFO, VLSFO, and MGO LS segments remained consistent. Additionally, the MDI index did not indicate any consistent trends over the period.
“We expect that the state of temporary stabilization in the global bunker market will
persist. Bunker indices are expected to continue fluctuating in different directions,” commented Sergey Ivanov, director of MABUX.
