The marine fuel market has entered a phase of extreme volatility. The ICE Brent contract for the nearest month has climbed to 106.89 dollars per barrel, driven by the closure of the Strait of Hormuz by Iran and the ensuing U.S. blockage. This logistical chokehold in the Persian Gulf has instantaneously reverberated in the Atlantic and Mediterranean terminals, where the prices of conventional fuels have begun an upward race that threatens to weigh down the margins of commercial fleets.
For shipowners operating on the Atlantic route, the current scenario demands surgical planning. With Brent settled above the psychological barrier of 100 dollars and a physical shortage of product at the docks, fuel savings and route optimization become survival imperatives. The update of May 12 confirms that bunkering is no longer just a commodity, but a strategic asset conditioned by the drums of war in the Middle East.
In the ports of the Strait of Gibraltar and the Canary Islands, the operational situation is critical. The availability of fuel for immediate delivery is nearly non-existent. According to market intelligence reports from ENGINE, buyers are facing consultation lead times of between seven to ten days to secure supply. In Gibraltar, delivery delays have already reached 12 hours, an inefficiency that strains the flow in one of the most trafficked maritime corridors in the world.
The day has resulted in erratic movements in local quotations. The price of VLSFO (very low sulfur fuel oil) has risen 12 dollars per ton in Gibraltar, while neighboring Algeciras has experienced an unusual decline of 33 dollars. This adjustment has evaporated the historical premium of the Spanish port over the Rock, reducing it to just 3 dollars per metric ton. In contrast, the differential in LSMGO (marine gas oil) has widened in favor of Algeciras, which today offers a 45 dollar discount compared to Gibraltar, attracting demand from ships with flexible calling options.
Further south, on the African axis, the port of Durban (South Africa) leads the daily increases. VLSFO has surged 34 dollars and LSMGO has skyrocketed 468 dollars per ton, reflecting the vulnerability of African circumvention routes in the face of instability in northern strategic passages. In Europe, Rotterdam is following the upward trend with increases of 41 dollars in heavy fuel oil, consolidating a trend of rising prices that shows no signs of exhaustion.
Geopolitics as a cost factor
The pressure on crude is attributable to purely geopolitical factors. Statements from U.S. President Donald Trump suggesting that the ceasefire with Tehran ‘hangs by a thread’ have sparked a wave of panic in the markets. Daniel Hynes, senior strategist at ANZ, warns that the flow of vessels through Hormuz is only a fraction of normal traffic, which restricts global supply in the foreseeable future. Warnings from Mohammad Bagher Ghalibaf, the Iranian parliamentary president, about a ‘well-deserved’ response to Washington’s aggression only add fuel to an already overheated market.
The only glimmer of relief lies in high-level diplomacy. The upcoming meeting between Trump and Chinese President Xi Jinping in Beijing has slightly slowed the escalation of futures. Analysts at ING Bank suggest that China could use its influence over Iran to bring it closer to a peace agreement, a hope that acts as the only bearish counterweight to the reality of military blockage.
