MABUX: Bunker market this morning, Jan 29, 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 Gasoil) in the main world hubs) slightly decreased on Jan.28:
380 HSFO: USD/MT – 365.37 (-0.86)
VLSFO: USD/MT – 460.94 (-0.98)
MGO: USD/MT – 516.85 (-1.40)
Correlation between the Market Bunker Price Index (MBP) vs MABUX Digital Bunker Price Index (DBP) in four major hubs on Jan.28 showed undercharging of 380 HSFO bunker grades in Rotterdam (-18USD), Singapore (-14USD) and Fujairah (-2USD). At the same time, in Houston MBP is corresponds to DBP. VLSFO is overcharged in all 4 hubs in range of 4-21USD. MGO LS remained undervalued in all ports except of Houston (+ 9 USD).
Meantime, world oil indexes demonstrated slight downward changes on Jan.28.
Brent for March settlement decreased by $0.28 to $55.53 a barrel on the London-based ICE Futures Europe exchange. West Texas Intermediate for March fell by $0.51 to $52.34 a barrel on the New York Mercantile Exchange. The Brent benchmark traded at the premium of $3.19 to WTI. Gasoil for February delivery lost $4.75.
Today oil indexes are mixed as slowing fuel demands was balanced by a pending supply cut by Saudi Arabia and lower U.S. oil stocks.
Saudi Arabia is set to cut output by 1 million barrels per day (bpd) in February and March, and compliance with output curbs by OPEC+ has improved in January. The Saudi cut effectively means OPEC+ supply cuts will increase from 7.2 million bpd in January to 8.125 million bpd in February. A 9.9 million barrel drawdown in U.S. oil inventories last week and forecasts for a small drop in U.S. oil production in February are also helping support the market.
However there are worries about stalled vaccine rollouts and the spread of contagious new variants of the coronavirus - South African variant has reached the United States. Concerns about a flood of new cases in Israel despite its success in vaccinating its population, and vaccine distribution issues in Europe and the United States as discouraging. This may lead to protracted lockdowns in Europe. At the same time, the market awaits of J&J vaccine to be approved sometime next week.
We expect bunker prices may demonstrate slight downward changes in a range of 1-3 USD.
