Shipments of high sulfur fuel oil from Europe to West Africa have fallen this month on dwindling bunker requirements, as volatile prices in the region have been a deterrent to buyers, sources have said.
Typically high sulfur and low sulfur fuel oil cargoes are exported to West Africa from Europe on both a contract and spot basis.
“We are optimising where to bunker and try to take as little as possible in WAF due to pricing,” one buyer said, while a bunker trader said: “Inquiries for the Lome area have diminished quite a bit”.
Three Suezmax vessels have sailed to West Africa in the past 11 days, the only vessels from Europe this month, according to Platts cFlow, a trade flow software.
They carried a total of 390,000 metric tonnes (mt) of bunker fuel, compared with 490,000 mt in April and 870,000 mt in March.
According to Platts cflow, the British Heritage has already discharged in Lome, Togo, while the King Philippos was on its way to Lome, with both having departed from the Canary Islands. Meanwhile, the Tataki departed Rotterdam on May 25 for Dakar, Senegal.
The price of 380 CST delivered bunker fuel at Lome has climbed progressively this year, in tandem with the broader oil complex, reaching a peak on May 18 at $495/mt delivered, the highest since S&P Global Platts began assessing the product on October 3, 2016.
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380 CST fuel at Lome was indicated at $452-464/mt delivered Wednesday morning more competitive prices are typically offered at Las Palmas, Spain, to the north and South Africa to the south.
Lome, on average, has priced at a premium of around $32/mt to Las Palmas since the Lome assessment began in 2016.
Suppliers and traders in the region saw no short-term reversal of the downward trend in the volume of fuel oil being moved to West Africa from Europe.