Shanghai bunker fuel prices at 45-month low on bearish crude, holiday

Shanghai bunker fuel prices fell to a 45-month low Wednesday as weak crude oil market sentiment and a week-long holiday in China increased selling activity, but traders said Thursday they hoped the lower values would now attract buyers.

Shanghai 380 CST bunker fuel fell $14.50/mt to $549.50/mt Wednesday, the lowest level since $545.50/mt on January 10, 2011. The marker was assessed at $548.50/mt Thursday.

This is the largest single day drop in Shanghai’s 380 CST delivered bunker fuel market since April 8, 2013, when the price fell $18/mt.

Shanghai bunker fuel traders said sales volumes rose prior to the Chinese holiday October 1-7.

“We hope to sell more this week, to make up for the loss of sales during the holiday,” a Shanghai trader said.

Traders said prices should improve in the medium term, as buying interest has already increased.

“Some shipowners are already buying fuel for dates as far as 10 days forward, in expectation that bunker fuel flat prices will moves up if crude futures rebound,” another trader said.
Source: Platts