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Rotterdam and Antwerp 380 CST low sulfur delivered bunker fuel oil spot prices have hit a two-month high as suppliers continued to struggle with tightness for finished prompt LSFO, bunker traders said.

Spot offers for December delivery 380 CST LSFO at the two major European ports climbed to $635/mt Friday, traders said.

Platts assessed 380 CST LSFO at $626.50/mt on Thursday, the highest since September 13 when it was assessed at $632.50/mt.

The 380 CST delivered LSFO barge market typically moves in close alignment with 1% sulfur Rotterdam barges, trading at around a $5-10/mt premium.

In the last few days, the 1% sulfur physical Rotterdam barge market has shifted to a deep backwardation over the front-month swaps market, showing a difference of $4.25/mt on November 28, Platts data shows.

On Thursday, the 1% sulfur Rotterdam barges outright price was at $620.25/mt compared to $616/mt for front-month swaps, Platts data shows.

Typically 1% sulfur physical Rotterdam barges trade at a clear contango versus swaps, as the market is usually well supplied in Northwest Europe because of International Maritime Organization standards enforcing use of cleaner 1% LSFO in the Emissions Control Area zone, traders said.

Although the Rotterdam HSFO barge market has seen a build of HSFO stocks for December moving the market into contango on the forward curve, prompt availability of LSFO has remained extremely low, traders said.

"Now, we can see there is a little strength on the prompt side for LSFO barges supported by strictly fundamental changes derived from strong demand and shortage of fuel," a trader said.

"Refineries have recently returned from turnarounds, margins are still weak that results in low output of finished products," the source said.

Most fuel oil suppliers in Northwest Europe have experienced tight availability of RMG grade in November due to a shortage of blending components.

"Suppliers are lacking blending components to blend LSFO grade. There are only a few blenders on the market and their tanks are not ready yet," the source said.

Traders said that LSFO bunker fuel is improving slightly for December deliveries with market seeing better LSFO offers from the Rotterdam barge side. However, market sources have expressed doubts whether there will be much of an upturn in availability before the year-end.

"I don't believe that refining is really coming back in December as people don't want to build up stocks. It will be coming back in January," a trader said.