MABUX: Bunker market this morning, Mar 23, 2021

The Bunker Review was contributed by Marine Bunker Exchange (MABUX)

MABUX World Bunker Index (consists of a range of prices for 380 HSFO, VLSFO and MGO in the main world hubs) demonstrated slight irregular changes on March 22:

380 HSFO – USD/MT – 417.37 (+4.89)
VLSFO – USD/MT – 516.52 (+2.03)
MGO – USD/MT – 590.05 (-0.10)

As of March 22, a correlation of MBP Index (Market Bunker Prices) vs DBP Index (Digital Bunker Prices = MABUX Digital Benchmark) in four largest global hubs showed that 380 HSFO fuel remained undervalued in three selected ports ranging from minus $ 3 (Houston) to minus $ 18 (Rotterdam), while an undercharge by $ 5 was registered at the port of Fujairah. Two ports, according to DBP Index, showed an underestimation of VLSFO fuel: minus $ 18 in Singapore and minus $ 7 in Rotterdam. Fujairah recorded a VLSFO overpricing by $ 28 and Houston – by $ 26. MGO LS, according to DBP Index, remained undercharged in two selected ports: minus $ 38 in Rotterdam and minus $ 36 in Singapore: the underestimation value remains unchanged during the last 3 days.  In Fujairah, DBP Index registered an MGO LS overpricing by $ 11 and in Houston – by $ 23.

World oil indexes rose slightly on March 22: new European coronavirus lockdowns dimmed hopes for a quick economic recovery, while market is still confident of a demand rebound later in the year.

Brent for May settlement rose by $0.09 to $64.62 a barrel on the London-based ICE Futures Europe exchange. West Texas Intermediate for May delivery increased by $0.14 to $61.56 a barrel on the New York Mercantile Exchange. The Brent benchmark traded at the premium of $3.06 to WTI. Gasoil for April delivery gained $3.00 – $513.50.

Today morning oil indexes continue slight downward movement.

Concerns grow over a spreading of COVID-19 cases across Europe. Nearly a third of people in France entered a month-long lockdown on March  20 while Germany plans to extend its COVID-19 lockdown into a fifth month.

The OPEC+ has put in place unprecedented production cuts in a pact to balance global markets after demand plunged during the COVID-19 pandemic.

Washington has threatened all companies involved in the Gazprom-led Nord Stream 2 gas pipeline project with sanctions. Meantime, German media reported, that the U.S. was ready to discuss lifting Nord Stream 2 sanctions if Germany was willing to offer a way to reduce Washington’s concern about Europe’s energy security. Germany will be the biggest beneficiary of additional Russian gas flows as it continues to shut down its coal and nuclear power plants.

U.S. drillers are starting to take advantage of the recent spike in prices, adding the most rigs since January in the week ending March 19.  The rig count has been rising over the past seven months and is up nearly 70% from a record low of 244 in August.

We expect bunker prices may rise slightly today by 1-3 USD for 380 HSFO and VLSFO, by 2-4 USD for MGO.



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