Week 24: Robust Growth in Global Bunker Indices and Market Trends

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In Week 24, the MABUX global bunker indices experienced robust growth across all segments:

  • 380 HSFO Index: Increased by 7.74 USD, rising from 536.75 USD/MT to 544.49 USD/MT.
  • VLSFO Index: Rose by 10.97 USD, moving from 622.76 USD/MT to 633.73 USD/MT.
  • MGO Index: Saw the most significant increase, adding 22.09 USD, from 801.93 USD/MT to 824.02 USD/MT.

MABUX Global Scrubber Spread (SS)

The Global Scrubber Spread (SS), which measures the price difference between 380 HSFO and VLSFO, experienced a moderate increase of $3.23, moving from $86.01 to $89.24. However, the spread remains below the critical $100.00 breakeven point. Notable regional trends include:

  • Rotterdam: SS Spread decreased by $4.00, from $69.00 to $65.00, with the weekly average also decreasing by $6.50.
  • Singapore: SS Spread increased by $7.00, from $68.00 to $75.00, with the weekly average adding $7.67.

Overall, while the contraction of the SS Spread has paused, indicators suggest an upward correction may continue into the next week.

European Gas Market Dynamics

According to StanChart, the European gas market remains sensitive to supply issues, with slower-than-usual inventory builds. Key points include:

  • EU Gas Inventories: Stood at 81.75 billion cubic meters (bcm) on June 2, showing a year-on-year increase of 1.1 bcm and a surplus of 14.9 bcm above the five-year average.
  • TTF Benchmark: Rose moderately by 0.488 EUR/MWh, from 33.797 EUR/MWh to 34.285 EUR/MWh.

LNG Bunker Fuel Prices

In the port of Sines (Portugal), the price of LNG as bunker fuel decreased slightly to 793 USD/MT on June 11, a reduction of 25 USD compared to the previous week. The price gap between LNG and conventional fuel nearly closed, with LNG priced just 4 USD below MGO LS.

MDI Index Trends

The MDI index, which compares market bunker prices (MABUX MBP Index) against the MABUX digital bunker benchmark (MABUX DBP Index), revealed the following trends across major global hubs:

  • 380 HSFO Segment: Singapore returned to an undervalued position, with all selected ports underpriced.
  • VLSFO Segment: All ports were undervalued, with weekly underprice levels increasing across all regions.
  • MGO LS Segment: Houston returned to the undervalued zone, joining other ports in this segment.

Alternative-Fuelled Vessel Orders

A report from DNV highlighted a significant increase in orders for alternative-fuelled vessels in May, with 33 new orders placed:

  • Methanol-Fuelled Vessels: 23 orders, including 10 for the container segment, five for bulk carriers, and four for car carriers.
  • LNG Vessels: Eight new orders.
  • Ammonia Vessels: Two new orders.

So far in 2024, there have been 127 new orders for alternative-fuelled vessels, marking a 55% increase compared to the first five months of 2023. Methanol has emerged as the leading alternative fuel segment this year.

The global bunker market shows a sustained upward trend, and we anticipate continued growth into the next week. For more detailed information on bunker prices and trends, visit the “Differentials” and “Digital Bunker Prices” sections on mabux.com.

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Source: LinkedIn India