Demand for bunker fuels at India's west coast ports of Mumbai, Kandla and Kochi increased in October, driven by strong supply availability from domestic refineries. However, east coast ports reported sluggish demand due to Diwali festivities and operational disruptions caused by Cyclone Montha, market participants, including traders, suppliers and barge operators, told Platts.

Mumbai volumes rebound after September drop

Bunker demand in Mumbai rebounded in October as shipowners and charterers renewed interest at the port.

A Mumbai-based supplier told Platts, part of S&P Global Commodity Insights, on Nov. 11, "Last month was good, and every company performed well. Inquiries were strong, and orders were closed. We supplied approximately 22,000-23,000 metric tons of very low sulfur fuel oil, while other participants handled 4,000-4,500 mt."

Bharat Petroleum Corporation Limited, which holds a significant market share in Mumbai's VLSFO, has achieved increased operational efficiency by commissioning a new supply point at Old Pir Pau.

"We have opened a supply point at Old Pir Pau, which is directly fed from the refinery. So, if the product is available at the refinery, which is 90% of the time, Old Pir Pau will have the product," a company source told Platts Nov. 11.

Stable demand at Gulf of Kutch

Kandla saw stable month over month demand, with some suppliers surpassing 2024 volumes, market participants said.

An Ahmedabad-based trader said, "October inquiries were steady, and product availability was good."

A Kandla-based supplier mentioned steady demand in October, with inquiries surpassing 2024 volumes despite operational challenges. "Our VLSFO volumes reached about 38,000 mt. The market was good last month, and we exceeded previous volumes," the supplier said. "However, cyclonic disruptions in late October affected operations, preventing loaded barges from supplying vessels."

Platts assessed marine fuel oil 0.5% delivered to Mumbai at $500/mt on Nov. 10, up $1/mt since the start of the week. In Singapore, Platts marine fuel 0.5% FOB cargoes rose $1.05/mt to close at $450.39/mt on Nov. 10. Marine fuel oil 0.5% delivered to Colombo was assessed at $515/mt, unchanged since the beginning of the week.

Kochi demand rises, LNG bunkering developments

Kochi experienced a rise in bunker fuel demand, driven by Hindustan Petroleum Corporation Limited's import of 4,000-4,500 mt of VLSFO from Fujairah. The increased product availability supported higher inquiry volumes, with industry totals exceeding 32,000 mt, a Kochi-based supplier said. "Every player at Kochi has product now, and the availability has boosted inquiries significantly," the supplier added.

The region also saw some positive developments in establishing LNG bunkering infrastructure. BPCL signed memorandums of understanding with Cochin Port Authority and Adani Ports and Special Economic Zone Ltd to establish LNG bunkering infrastructure in the last week of October.

"We signed an MOU with APSEZ for Vizhinjam and Cochin Port Authority for LNG Bunkering. We are trying to get one vessel for bunkering at Kochi first, for shore-to-ship LNG bunkering. For Vizhinjam, in the coming months, we need an LNG bunker barge to start ship-to-ship bunkering, which is also under discussion," a source close to the developments told Platts.

Mixed demand at east coast ports

East coast ports experienced mixed demand for marine fuel in October, influenced by the Diwali festival and disruptions from Cyclone Montha.

"Due to the festival season in October, we did not observe significant demand in the area," a Visakhapatnam-based trader said. "At the Port of Haldia, the refinery supplied only 8,000 mt for the month, while the Port of Chennai supplied 6,000 mt as a regular volume. There were also operational disruptions during the last week of October at the east coast-based ports due to the effects of Cyclone Montha."

"Last month we saw a rise in demand, primarily during the last two weeks. We do not have any issue in product availability," a Paradip-based supplier added.

"Our demand majorly comes from coastal vessels, dredgers and bonded demand from vessels heading towards Singapore. Our volumes reached 8,000 mt in October. We also had an operational shutdown for two days due to the cyclone."

HPCL supply issues

HPCL's refined product supplies faced disruptions in October due to contaminated crude from the B-80 Mumbai Offshore oilfield, a source close to the company said Nov. 10.

"The chlorine levels in the crude that HPCL received were way off the limits, which affected their ability to supply product in the market. Their entire batch was ruined," a Mumbai-based trader said. "They also issued fuel import tenders to meet demand."

High sulfur fuel oil supplies remained unaffected, and refinery operations have since returned to normal, the source added.

November outlook

Demand in November has been mixed, with weak inquiry volumes at Mumbai and east coast ports, while Kandla and Kochi continue to see steady growth.

Market sources said demand remained subdued at most ports during the initial days of November. Inquiry volumes have decreased at Mumbai and most east coast ports, market sources from various ports Platts talked to said. However, Kandla and Kochi reported continued increases in demand.

"In November, there is no demand at all in east coast ports, with only limited inquiries seen so far," a Visakhapatnam-based trader said.

"This month, the demand has gone down as the prices have remained volatile, but still demand remains decent. We get one or two enquiries every day," said a Paradip-based supplier.

Bunker sales at Kandla were described as "good," with inquiry volumes reaching 16,000-17,000 mt, supported by robust supplies. Similarly, Kochi experienced a rise in bunker-only calls, which boosted Outside Port Limit demand. "We are getting inquiries with big stem sizes, mostly bunker-only calls. The vessel calls have improved at Kochi, and we offer competitive prices, which has helped the demand rise," a Kochi-based supplier said. 

Source: S&P Global 

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