- Global bunker fuel indices saw notable declines in Week 19, with all key grades—380 HSFO, VLSFO, and MGO—recording lower prices.
- Scrubber Spread trends remained mixed across major ports, but VLSFO maintained its profitability over 380 HSFO with scrubbers.
- LNG bunker fuel prices rose, while European gas imports and storage trends highlighted evolving supply dynamics.
At the close of Week 19, MABUX Global bunker indices extended their downward trend. The 380 HSFO index fell by $16.81, dropping from $459.28/MT to $442.47/MT and falling below the $450 threshold. VLSFO prices declined by $20.92, reaching $510.88/MT from $531.80/MT, nearing the critical $500 mark. MGO also dropped significantly by $21.64, falling to $700.99/MT from $722.63/MT. However, by the end of the week, the market showed early signs of a moderate upward correction, suggesting a potential shift in momentum, according to LinkedIn India.
Scrubber Spread Dynamics Show Mixed Signals
The Global Scrubber Spread (SS), which represents the price difference between 380 HSFO and VLSFO, continued its moderate downward trend, slipping $4.11 from $72.52 to $68.41—now below the $70 threshold. The global weekly average also edged down slightly by $0.37. Interestingly, Rotterdam’s SS Spread reversed course with a $4.00 increase to $37.00, while Singapore saw a more significant jump of $18.00 to $78.00. Despite regional fluctuations, all SS spreads remained below the $100 breakeven mark, maintaining the cost advantage of using VLSFO over HSFO with scrubbers.
European Gas Market Trends and LNG Price Shifts
According to the IEEFA, the EU has reduced combined pipeline and LNG gas imports by 18% since 2021, aligning with a broader 20% drop in gas consumption. Norway has become the EU’s leading supplier of pipeline gas, while the U.S. leads in LNG supply. As of May 6, EU gas storage levels reached 41.41%, reflecting a modest weekly increase but a notable decline from the year’s start. Meanwhile, the benchmark TTF price rose by €2.89/MWh to €34.743/MWh.
In the LNG bunker market, prices at the port of Sines increased by $13, reaching $734/MT. However, conventional fuels like MGO LS remained cheaper by $77/MT, widening the cost gap from the previous week’s $42/MT.
MDI Trends Reflect Mixed Market Valuations
The MABUX Market Differential Index (MDI), which compares market prices with digital benchmarks, revealed nuanced movements. In the 380 HSFO segment, Rotterdam joined Singapore in the overvalued category, while Fujairah and Houston remained undervalued. The VLSFO segment showed undervaluation across all ports, with Singapore nearing price-benchmark parity. For MGO LS, only Rotterdam remained overvalued, though with a slight decrease, while other ports deepened their undervaluation. No significant structural changes were observed overall.
Fuel Quality Indicators Shift in Q1 2025
Bureau Veritas’ Q1 2025 VeriFuel report highlighted a global increase in VLSFO viscosity, rising to 173 cSt from 161 cSt in Q4 2024. Sediment content and catalytic fines also showed slight increases, along with a rise in off-spec VLSFO to 1.8%. Conversely, HSFO viscosity slightly decreased, while its off-spec rate rose to 1.8%. The DMA grade showed improved quality with a reduced off-spec rate from 2.7% to 2.2%.
Market Outlook
Following the consistent price drops during Week 19, the bunker market is showing early signs of a moderate rebound. Given current indicators and modest corrections, there is potential for bunker indices to resume an upward trajectory in the coming week.
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Source: LinkedIn India
