Global bunker fuel prices have continued to nosedive as they closed in on the $200-per metric tonne (pmt) mark, falling in line with crude oil prices dipping below $40 per barrel and nearing 10-year low.
The price of global benchmark Singapore 380 cst bunker fuel was assessed by Rueters at $209 per metric tonne (pmt) on Monday, a level last reached on 4 March 2005, with the Reuters data suggesting that bunker prices have touched a 10-year low.
However data obtained by Seatrade Maritime News pointed to a lower price of $198 pmt reached on 31 December 2008, and the prices were largely at $200 pmt after Christmas that year.
Other sources of bunker price data such as industry specialist Ship & Bunker indicated Singapore 380 cst price at $212 pmt yesterday, having fallen $18.50 since Friday and $40 week-on-week.
And yesterday’s bunker price has plummeted by $375.50 pmt, or 64%, from the $587.50 pmt recorded exactly one year ago, Ship & Bunker data showed.
With the volatility hallmark of the bunker market, there is no certainty that bunker prices will fall below the $200-pmt mark, though the current trend suggests a high chance of that happening, according to Singapore-based bunker traders.
The bearish crude oil market tracks the sluggish global stock selloff led by China’s crash, as major leading news sources touted yesterday as the ‘Black Monday’.
For shipowners, lower bunker prices simply means reduced operating costs, and the softer fuel market is a helpful boost to lower income generated from the weak freight rates.
Bunker traders noted that demand has yet to pick up swiftly despite the bear market as buyers believed that prices will drop even further.
Outside Singapore, key bunkering ports globally have also softened with Europe’s Rotterdam indicated at $211 pmt on Monday after falling $12, Houston in the US at $213.50 pmt with a dip of $6 and Fujairah in the Middle East at $215 pmt following a $20.50 plunge, according to Ship & Bunker.
By Pita Ochai