Bunker fuel prices at a number of ports in the Mediterranean have sunk to lows of four to six weeks on falling high sulfur fuel oil but this could change on the back of rising pre-Christmas demand from shippers, sources said.
S&P Global Platts assessed 380 CST fuel oil at Malta, Piraeus and Istanbul at $348/mt, $358/mt and $363/mt delivered Thursday respectively, their lowest levels since October 27.
Prices have to a large extent tracked HSFO CIF Med cargoes. The regional benchmark reached $333/mt CIF Wednesday, its lowest level since October 26. The price edged up 75 cents/mt Thursday.
Lengthening supply of HSFO cargoes in the region has been weighing on values and this situation could remain in place throughout December, HSFO trading sources said.
“December is very very long on components and finished grade,” a trader said.
In the Mediterranean, players had already covered December commitments at the end of November and there is now an overload of product available.
This in turn bodes well for bunker demand in the region. “Demand is likely to pick up due to the big drop in Med cargoes,” a trader said Thursday.
This comes as shipping and bunker sources expect increased buying interest in the run-up to Christmas.
“Demand already up from usual today because of [the drop in cargoes],” the bunker trader said. “Early next week demand will pick up further — suppliers will be booked up for holiday season as most don’t supply during Christmas.”
Source: Hellenic Shipping News.