EMEA News
'Extremely Low Avails' Drive Fujairah VLSFO Price to Record High
A lack of supply has driven the cost of VLSFO at Fujairah to the highest level on record this week, surpassing both the levels seen in March at the start of the current Middle East conflict and those seen in 2022 after Russia invaded Ukraine.
VLSFO delivered at Fujairah jumped by $137.50/mt on Wednesday - adding to the previous day's $60/mt gain - to reach $1,201/mt, according to Ship & Bunker prices, compared to the previous peak this year of $1,104/mt on March 19. The price then eased slightly on Thursday, losing $18/mt to $1,183/mt.
Before the current conflict in Iran, Fujairah VLSFO was trading at $519.50/mt on February 27, 56% below current levels.
The market has moved this week not on any particular headline, but just with dwindling supplies and high costs, a local source told Ship & Bunker.
"The prices are driven by extremely low avails of VLSFO; there's no big new flows in sight yet," the sources said.
"Insurance premiums will keep the market elevated."
Fujairah has been the bunkering port worst impacted by the war in Iran. The hub faces a series of challenges that will seemingly remain insurmountable until the conflict ends: a lack of supply from its usual refineries in the Gulf, its usual customers not being able to transit the Strait of Hormuz, and Iranian attacks on the port itself and nearby ships that make bunkering operations too dangerous for many to consider.
Under normal circumstances Fujairah is the world's third-largest bunkering location after Singapore and Rotterdam. Sales in April totalled just 126,253 mt, a record low, down by 20.3% from March's level and by 81.1% from the same month a year earlier.
Key Bunker Prices More
| VLSFO | MGO | |||
|---|---|---|---|---|
| $/mt | +/- | $/mt | +/- | |
| Singapore | 890.00 | 9.50 | 1243.00 | 35.50 |
| Rotterdam | 682.50 | 13.00 | 1340.00 | 15.50 |
| Houston | 745.50 | 3.00 | 1370.00 | 1.00 |
| Fujairah | 979.50 | 5.00 | 1676.50 | 11.50 |
| EMEA Average | 865.50 | 3.50 | 1635.50 | 44.50 |
| Global 20 Ports Average | 876.50 | 0.00 | 1500.00 | 8.50 |
| Global 4 Ports Average | 824.50 | 1.00 | 1407.50 | 10.00 |
| Global Average Bunker Price | 930.50 | 1.50 | 1567.00 | 17.50 |
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