The price of marine gasoil at the Russian Baltic Sea port of St Petersburg has soared to match price levels seen at the Northwest European bunkering hub of Rotterdam.
Marine gasoil at St. Petersburg was assessed at $506/mt Tuesday, on par with the price at Rotterdam.
Typically the discount at St. Petersburg is what attracts ship owners to the port to bunker as vessels would normally bypass Rotterdam on voyages out of the Baltic Sea and into Europe, thus making cheaper fuel conveniently accessible.
But MGO prices have tracked firm domestic diesel prices, which have been drawing support from tight availability and firm export netbacks.
"There are many turnarounds and output is lower," a Russian trader said.
A host of Russian refineries, including Kirishi, are carrying out their autumn maintenance works, due to be completed by the end of October. That, coupled with firm international benchmarks and strong demand during the agricultural works, had pushed domestic prices up, which in turn affected the bunker market.
In addition, the low number of MGO suppliers in St. Petersburg is making it one of the less competitive ports for MGO prices. "In St. Petersburg there isn't such big competition, there are only a few suppliers who can do gasoil," a bunker supplier said.
However, once the harvest season in Russia is completed, domestic diesel demand is expected to dwindle and weigh on price levels.
Source: PlattsPrevious Next