- Moderate Growth in Global Bunker Indices for Week 39.
- Europe’s LNG Demand Peaks, Stranded Assets Risk Grows.
- TTF Gas Prices Steady, LNG Bunker Price Gap Narrows in Sines.
In Week 39, the global bunker indices of MABUX increased moderately. The index for 380 HSFO increased by USD 8.33: from USD 503.94/MT last week to USD 512.27/MT remaining close to the USD 500 mark. The VLSFO index increased by USD 10.34 (USD 612.42/MT vs. USD 602.08/MT last week). The MGO index increased by USD 8.93 (from USD 749.24/MT last week to USD 758.17/MT). Up to the writing date, not much change in the global bunker market indices has occurred, reports MABUX.
Scrubber Spread (SS) Analysis
The MABUX Global Scrubber Spread (SS) is the differential price between 380 HSFO and VLSFO. Global SS moderately advanced up to USD 100.15, and in so doing, it reached the critical level of SS breakeven at USD 100. It reduced its weekly average by USD 1.64.
- Rotterdam SS Spread: The SS Spread in Rotterdam declined by USD 12.00 to USD 79.00 from USD 91.00 last week. Meanwhile, the weekly average also declined by USD 14.33.
- Singapore SS Spread: Singapore saw the spread between 380 HSFO and VLSFO at USD 140.00 versus USD 138.00 in the previous week increasing by USD 2.00. The weekly average dropped by USD 6.50 in the meantime.
General mixed movement of the SS Spread was seen during the week and is expected to be felt in the next week too.
LNG Market Insights
Europe’s LNG demand has probably peaked according to the Institute for Energy Economics and Financial Analysis, also further stating that most of the LNG infrastructure built recently in Europe has a chance to become a stranded asset towards the end of the decade. European LNG imports have declined by 20% year-on-year in the first half of 2024.
European LNG Demand Forecast
IEEFA further predicts that by 2030, over 300 billion cubic meters (bcm) of LNG import capacity may go underutilized as demand is expected to fall below planned capacity levels. As of September 25, the Europe storage levels filled up to 93.74%.
European TTF Gas Benchmark Update
TTF European Gas Benchmark Trended Steady Week 39: declined EUR 0.134/MWh, closed at EUR 35.413/MWh vs. EUR 35.547/MWh last week.
LNG Price in Sines
In the port of Sines (Portugal), LNG as bunker fuel was priced lower by another USD 10 to USD 823/MT on September 23.
In further support of this downward trend, the price gap between LNG and conventional fuel shrank by USD 31 from the previous week to stand at now USD 105 in favour of MGO LS.
MABUX Market Digital Index (MDI) Trends
The MABUX Market Digital Index (MDI) for Week 39, in comparison of market bunker prices (MABUX MBP Index) with the MABUX digital benchmark (MABUX DBP Index), showed four major global port trends that include Rotterdam, Singapore, Fujairah, and Houston.
380 HSFO Segment
In the 380 HSFO segment, all four ports were underpriced. Rotterdam and Singapore saw weekly averages fall by 9 bps and by 7 bps, respectively. Fujairah gained 12 bps. Houston was unchanged.
VLSFO Segment
Singapore and Fujairah remained overvalued, but in both cities, the weekly averages decreased by 5 bps in Singapore and 19 bps in Fujairah.
On the other hand, Rotterdam and Houston were still under-valued where their averages increased by 9 bps in Rotterdam and 3 bps in Houston.
MGO LS Market Segment
All four ports were overestimated in the MGO LS segment. Weekly averages jumped 8 points in Rotterdam, 9 points in Singapore, 14 points in Fujairah, and 9 points in Houston.
The indices of Rotterdam and Singapore continued to stay steady above the USD 100 threshold, and Houston’s index was kept close to the 100% correlation between market prices and the MABUX digital benchmark.
Market Outlook for Week 40
The global bunker market is still expected to continue growing while indices of bunkers are forecasted to continue going upwards with a modest increase in the coming weeks, supported by the general market dynamics and sustainability efforts within the maritime domain.
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Source: MABUX
