Bunker Prices Surge to 16 Month Highs, Break $300/mt in the Primary Ports [Graph]

Friday December 2, 2016

Following the agreement this week among Organization of the Petroleum Exporting Countries (OPEC) to cut back oil production, bunker prices have followed crude up and surged to 16 month highs, data from Ship & Bunker shows.

Ship & Bunker's Global 20 Ports Average (G20) bunker price for IFO380, which represents the vast majority of global bunker volumes, on Thursday jumped $10/mt to a 16 month high of $304/mt, breaking the $300/mt mark for the first time since July 30, 2015.

The average price for 380 cSt product Thursday across the four ports of Singapore, Rotterdam, Fujairah, and Houston (Ship & Bunker's Global 4 Average bunker price that collectively accounts for about a quarter of global bunker sales) was $294.50/mt - having made a $24/mt gain since Monday.

For all the bullish sentiment this week, significant uncertainties over the deal remain, and while at this point a return to sub $200/mt bunkers seems unlikely, bunker buyers should nevertheless expect continued volatility as we head into 2017.