MABUX: Bunker market this morning, Feb.04, 2021
MABUX World Bunker Index (consists of a range of prices for 380 HSFO, VLSFO and MGO Gasoil) in the main world hubs) demonstrated upward changes on Feb.03:
380 HSFO – USD/MT – 371.30 (+3.65)
VLSFO – USD/MT – 472.44 (+6.59)
MGO – USD/MT – 526.18 (+6.63)
Correlation between the Market Bunker Price Index (MBP) vs MABUX Digital Bunker Price Index (DBP) in four major hubs on Feb.03 showed undercharging of 380 HSFO bunker grades in all ports (from -4USD to -12 USD). VLSFO is overcharged in all 4 hubs in a range of 12-17USD. MGO LS undervalued in all four major hubs.
Meantime, world oil indexes increased on Feb.03.
Brent for April settlement increased by $1.00 to $58.46 a barrel on the London-based ICE Futures Europe exchange. West Texas Intermediate for March rose by $0.93 to $55.69 a barrel on the New York Mercantile Exchange. The Brent benchmark traded at the premium of $2.77 to WTI. Gasoil for February delivery added $5.50.
Today oil indexes continue to rise after OPEC+ decided to continue with a reduced output policy at a meeting on Feb.03.
OPEC+ extended its current oil output policy during a meeting of its Joint Ministerial Monitoring Committee on Wednesday. The cartel’s decision indicates that efforts to reduce inventory will continue even as the COVID-19 pandemic lingers and the outlook for fuel demand remains uncertain. It is also an indication that OPEC+ is starting to unwind the unprecedented production cuts it implemented in 2020, which helped oil rally from record lows.
At the same time, information from the U.S. Energy Information Administration (EIA) also supported oil indexes. The data from EIA showed a draw of 994,000 million barrels in U.S. oil inventories. It was forecasted a 446,000-barrel build, and a 9.190-million-barrel draw was recorded during the previous week. Crude oil stockpiles in the U.S. are now at their lowest levels since March. However, gasoline inventories jumped by almost three times as much as forecast to the highest since June. The EIA projected that American oil production wouldn’t surpass 2019 levels until 2023. Despite the downtrend in stockpiles, a recovery in fuel consumption remains shaky as lockdown measures limit mobility and concerns grow over the spread of several Covid-19 mutations. From the other side, continued progress in rolling out COVID-19 vaccines globally is also an important driver of oil prices.
We expect bunker prices may demonstrate upward changes: 5-7 USD up for 380 HSFO, 3-5 USD up for MGO.