Evgenia Vanadzina Gasum

Evgenia Vanadzina

Portfolio Manager
evgenia.vanadzina@gasum.com
tel. +358401801066

07.10.2020  

Maritime market update: fuel oil prices continue to drop despite reduced refinery runs

Risavika LNG front month has further increased by 4 % week on week to 23.39 EUR/MWh for November index, following the seasonal change and anticipated higher demand for gas from local distribution zones in Europe.

Fuel oil 3.5 has decreased by 9.2 % to 212.74 USD/t, while low sulfur oil (MFO 0.5) has dropped by 6.9 % and traded at 279.89 USD/t and MGO 0.1 has lost 3.4 % week on week and reached 311.13 USD/t. This drop is mainly influenced by fall of oil prices last week amid concerns over the demand recovery and return of Libyan oil production, despite the recent data on draw from the inventories both in Amsterdam-Rotterdam-Antwerp (ARA) region and the US.

European refineries reduced runs during the third quarter due to poor margins, which resulted in a lack of fuel oil availability across all grades in Europe during September. The MFO 0.5 market was previously awash with supply after COVID-19 hit global oil demand. While the supply glut appears to have eased somewhat, demand has yet to completely recover. Combined fuel oil stocks in the ARA hub in the week to Sept. 23 sat at 1.390 million mt, according to data from Insights Global, down from 1.533 million mt July 1.

 

LNG Risavika - LNG FOB Risavika 

LBG Risavika 10 % - 10 % blend of Liquified Biogas

FO 3.5 FOB Rdam – European 3.5% Fuel Oil Barges FOB Rdam (Platts) Futures Quotes

MFO 0.5 FOB Rdam - European FOB Rdam Marine Fuel 0.5% Barges (Platts) Futures Quotes

MGO 0.1 FOB ARA - Gasoil 0.1% Barges FOB ARA (Platts) Futures Quotes

ULSD FOB ARA - European Diesel 10 ppm Barges FOB ARA (Platts) Futures Quotes

 

Front Month Price index
LNG Risavika* LBG blendRisavika** FO 3.5 FOB Rdam MFO 0.5 FOB Rdam MGO 0.1 FOB ARA ULSD FOB ARA Unit
23.39 26.39 15.25 19.22 21.36 22.79 EUR/MWh
396.16 446.98 212.74 279.89 311.13 317.88 USD/t

 Price index 5.10.2020.png

Source: CME Group, Gasum, HellenicShippingNews

*An estimate for LNG FOB Risavika 

** An estimate for 10 % LBG blend FOB Risavika