ENGINE: Europe & Africa Bunker Fuel Availability Outlook
Stronger demand and refinery margins for oil products may have spurred refineries to ramp up production, resulting in higher HSFO output as a by-product. Also, more fuel oil has been imported from Russian ports in the Baltic Sea. But a VLCC might load up on fuel oil in ARA over the coming days and draw the inventories, sources say.
The last time there was this much fuel oil in storage in ARA was in June last year, when Covid-19 demand destruction had swelled fuel oil inventories to multi-year highs.
The hub’s gasoil inventories added 90,000 bbls on the week and reached 20.06 million bbls – their highest level since October last year.
VLSFO, HSFO380 and LSMGO are all readily available with most bunker suppliers in ARA, where lead times for bunker stems have been considerably lower than in Fujairah and Singapore in recent months.
HSFO is tighter in certain ports further south. A supplier in Las Palmas is out of HSFO380 and does not expect to replenish its inventories until April. Six days of lead time are generally required for bunker stems in the Canary Islands now.
South African ports have had limited volumes of HSFO180 to supply for weeks. Two of the country’s refineries, making up about half of its capacity to produce oil products, have been offline since they were struck by explosions and fires last year. South Africa has imported significantly more oil products to cover its domestic production shortfall, including gasoil, but not yet fuel oil.
VLSFO and LSMGO stems are more available in ports across the Canary Islands and South Africa. Availability of these grades is also good in Istanbul, Piraeus and Malta.
Rough weather suspended port operations in Gibraltar and Ceuta at the start of the week. But the weather calmed on Tuesday, allowing suppliers to work through backlogs and bring bunker queues down. Three vessels were waiting to bunker in Gibraltar on Wednesday, down from a peak of 15 vessels on Tuesday, according to port agency MHBland. There are also minor delays in Algeciras, while suppliers in Ceuta have cleared all their backlogs from earlier this week.
Several other European ports have bad weather coming up this week. Novorossiysk has a gale warning until Thursday morning and a backlog of vessels waiting to be supplied with bunkers. Lisbon has strong winds forecast on Friday and Saturday. Las Palmas is expected to have high swell coming from the northwest from Saturday evening, which is set to grow higher and peak at 2.7 metres on Sunday. Swell of over 1.5 metres in the northwest direction can disrupt bunkering at Las Palmas’ outer anchorage.
Source: ENGINE, (https://engine.online/)