MABUX: Bunker Weekly Outlook, Week 31, 2021

The Weekly Outlook was contributed by Marine Bunker Exchange (MABUX)

On a Week 31, MABUX World Bunker Index did not show any significant changes. The 380 HSFO index rose by 2.75 USD: from 454.61 USD/MT to 457.36 USD/MT, the VLSFO index fell by 0.08 USD: from 558.89 US /MT to 558.81 USD/MT, while the MGO index added 1.30 USD (from 650.06 USD/MT to 651.36 USD/MT).

European gas markets continue being volatile with bullish sentiment prevailing. Natural gas supplies are still weaker due to summer maintenances. MABUX ARA LNG Bunker Index, calculated as the average price of LNG as a marine fuel in the ARA region, rose sharply from July 28 to August 04: an increase from 769.77 USD/MT to 919.66 USD/MT (+149.89 USD). At the same time, the average value of the LNG Bunker Index increased by 38.50 USD compared to the previous week. The average price for MGO LS in Rotterdam during the same period decreased by 12.00 USD/MT, and the average price difference between bunker LNG and MGO LS in Rotterdam increased by 28.50 USD and exceeded the 200 USD mark: 220.22 USD (versus 191.72 USD last week). The growth of the LNG ARA Index reflects the current situation in the global LNG market, where a firm upward trend continues. More information is available in the new LNG Bunkering section at www.mabux.com.

The average weekly Global Scrubber Spread (SS) – the difference in price between 380 HSFO and VLSFO –decreased slightly last week and on August 04 came close to the psychological mark of $ 100: $ 103.18 (versus $ 106.24 last week). At the same time, the average value of SS Spread in Rotterdam also decreased by $ 0.83 and reached $ 110.00 ($ 110.83 last week). In Singapore, the average SS Spread declined by $ 2.00 to $ 122.83 ($ 124.83 last week). The SS Spread averages in both ports remain above the $ 100 mark. More information is available in the Differentials section of www.mabux.com.

Correlation of MABUX MBP Index (Market Bunker Prices) vs MABUX DBP Index (MABUX Digital Benchmark) in the four global largest hubs during the past week showed that 380 HSFO fuel remained undervalued in all four selected ports ranging from minus $ 20 in Houston (unchanged compared to last week) and minus $ 20 in Fujairah (versus minus $ 16 last week) to minus $ 33 in Rotterdam (minus $ 34) and minus $ 43 in Singapore (versus minus $ 44). MABUX MBP / DBP Index ratio for 380 HSFO fuel has not changed significantly.

VLSFO fuel grade, according to the MABUX DBP Index, was also underestimated in all four selected ports: in Houston the underpricing was recorded as minus $ 14 (minus $ 12 last week), in Rotterdam - minus $ 26 (minus $ 24), in Fujairah - minus $ 37 (versus minus $ 32), in Singapore - minus $ 39 (versus minus $ 35). In general, the MBP/DBP Index ratio for VLSFO fuel has remained steady.

As for MGO LS, MABUX DBP Index has registered an undercharge of this grade at all selected ports ranging from minus $ 28 (minus $ 16 last week) in Houston to minus $ 55 (minus $ 52) in Rotterdam, minus $ 75 (vs. minus $ 68) in Singapore and minus $ 64 (minus $ 47) in Fujairah. The underestimation margins, according to MBP/DBP Index, increased last week in all ports. The most significant growth was registered in Houston (plus $ 12) and Fujairah (plus $ 17).

The European Union has given the green light for a €118 million investment from the Innovation Fund to be allocated across 32 small projects, including a bioLNG plant to produce marine fuel and the retrofit of a ferry to operate on battery power. The projects are located in 14 EU Member States, as well as Iceland and Norway. The grants are intended to support projects aiming to bring low carbon technologies to the market in energy intensive industries, hydrogen, energy storage and renewable energy. In addition to this funding, 15 of the projects will receive project development assistance worth up to €4.4 million.

Source: www.mabux.com