Bunkering companies in Suez Port are struggling with longer than usual delays in replenishing bunker fuel supplies because of problems sourcing product.
Companies have faced persistent problems in procuring bunker supplies throughout August. Two traders at the port speaking with Argus confirmed there has been a lack of both very-low sulphur fuel oil (VLSFO) and high sulphur fuel oil (HSFO) for over a month. One company last supplied a vessel with VLSFO on 15 July.
Supply problems at Suez port are frequent, according to local traders, but recent delays have been "longer than any previous cases". Private bunkering companies operating in the port cannot import marine fuel directly, and instead rely on the ministry of petroleum along with state-owned suppliers and storage companies.
One local trader, whose supplies come from the 100,000 b/d El-Nasr refinery in Suez, estimated that 15,000-20,000t of marine grade VLSFO and HSFO each are produced and made available to private suppliers every 40-50 days. But given regular demand at the port, supplies often run out within two weeks, leaving suppliers without product to offer.
Another bunkering company in Suez relies on imported fuel for its supplies but suffers similar procurement problems. Unable to import and store product itself, supplies are bought from state-owned companies like Misr Petroleum or Copetrol who import and store oil products in the Sonker or Sumed terminals in Ain Sukhna. Despite 352,000t of HSFO arriving in Ain Sukhna since July, according to Vortexa, very little of it has been allocated to private bunker suppliers.
One trader received an enquiry for 1,000-1,200t of HSFO from a vessel passing through the Suez Canal at the beginning of August, but could not fulfil the request. This follows similar problems in supplying VLSFO throughout the month. On 8 August, because of a lack of VLSFO at Suez, traders were forced for urgent enquiries to load VLSFO on trucks at the Mediterranean port of Alexandria and reload it onto barges to supply in Suez.
The supply of marine gasoil (MGO) has had similar but less acute supply problems at the port since June.
To grapple with the availability problems at the port, traders have redirected shipowners to nearby ports in the Red Sea, including Jeddah, Djibouti or Port Sudan, or the Mediterranean ports of Piraeus or Malta.
But shipowners are aware of the availability problems at Suez and some avoid it altogether. One tanker company speaking with Argus said it has not bunkered there regularly since 2012 because of fuel quality issues and availability problems, preferring Malta and Djibouti instead. Another tanker company said it also avoids bunkering at the port because of availability problems. On top of this, regulations limit the validity of prices to nine days from booking, restricting how far in advance the company can book deliveries.
In February, Egypt awarded four bunkering licences to Minerva Bunkering, Peninsula and Coral Energy, but none have yet begun operations.
