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ENGINE: Europe & Africa Bunker Fuel Availability Outlook

LSMGO and HSFO380 supply has tightened in ARA this week, while VLSFO remains in good supply in the bunkering hub.
Several suppliers seeing delayed resupply of LSMGO in ARA and some have set 27 April as their earliest delivery date for the grade.

Loading delays at a local refiner’s jetty have tightened supply, sources said. Bunker suppliers can still deliver prompt stems with LSMGO volumes already loaded onto barges, but reloading of the barges could take time.

Prices for LSMGO have so far been unaffected, with Rotterdam’s LSMGO premiums over VLSFO and HSFO380 actually narrowing.

ARA’s independent gasoil inventories were drawn last week and fell to 12-month lows of 17.02 million bbls, Insights Global data showed. Gasoil stocks have declined as refineries have cut runs amid European lockdowns and low transport fuel demand.

The hub’s fuel oil inventories bounced back to 10.98 million bbls after adding 1.42 million bbls in the past week – the highest weekly gain in two months. Prompt HSFO380 bunker supplies have tightened slightly in ARA this week.

Bunker suppliers can deliver VLSFO on short notice. Some suppliers will only deliver stems above a certain size and may have longer lead times.

VLSFO remains available with most suppliers in the Canary Islands, while one supplier has tight availability of prompt product. LSMGO has tightened with several suppliers in the Canary Islands, widening price premiums over Gibraltar to $8-10/mt for the grade.

Gibraltar Strait ports have good availability across grades, and similar lead times for HSFO380 as in ARA. HSFO380 requires 4-5 days of lead time recommended in ARA and Gibraltar, compared to six days in the Canary Islands, where a supplier is out of product.

VLSFO and LSMGO remains widely available for deliveries in South Africa’s Port Elizabeth and Durban, as well as in Mauritius’ Port Louis.

There are no bunker delays and minimal congestion in the Gibraltar Strait ports, according to local port agency MH Bland. Rough weather is forecast on Friday and Saturday, which could disrupt bunkering then.

Offshore bunkering around Malta was disrupted by rough weather earlier this week, and faces more disruptions this weekend. Malta has strong winds and swell forecast from Thursday to Saturday morning.

Off Skaw in Denmark has a gale warning for Thursday, which could push some stems into ports in Skagen or Sweden’s Gothenburg.
Source: ENGINE (https://engine.online/)

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