Supply of high sulfur 380 CST fuel oil, one of the fuels used to power tankers, remained tight at the port of Rotterdam, the Netherlands, sources said.
“Avails were a little tight to be honest [late Thursday afternoon]. Only three out of nine suppliers quoted,” a buyer said. “I wonder whether people [are] waiting for new contract barrels to come into effect in February, because perhaps now if they load spot cargoes they pay higher price,” the buyer added.
However, some local suppliers said availability was satisfactory at the port on Thursday.
The scarce availability did support higher prices with 380 CST fuel assessed at $377/mt delivered Thursday, rising day on day throughout the week, up from $361/mt delivered assessed Monday.
This strength was also reflected in the European high sulfur fuel oil market due to increased demand from Singapore and Saudi Arabia on profitable arbitrages, which outweighed falling supply as a result of lower Russian exports and refinery upgrades in NWE in preparation for the International Maritime Organization’s tighter sulfur cap in 2020.
The VLCC Nave Buena Suerte is anchored outside Rotterdam port, according to S&P Global Platts trade flow software cFlow, and is expected to load about 270,000 mt of fuel oil for discharge in Singapore, shipping sources said. The Aframax Sea Hope departed Rotterdam late Friday for Singapore, cFlow showed, carrying about 100,000 mt of HSFO, shipping sources said.
In total, about 760,000 mt of HSFO departed in January, mostly for discharge in Singapore, which supported a backwardated structure in the 3.5% FOB Rotterdam barge forward curve on the prompt months.
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