Americas Market Update 14 Jan

Fuel prices have moved in mixed directions, and Zona Común is expected to face prolonged delivery delays from Friday.

IMAGE: Container ship leaving the Port of Houston at Morgan's Point. Getty Images.

Changes on the day to 07.00 CST (13.00 GMT) today:

• VLSFO prices up in Houston, Los Angeles ($9/mt), New York ($8/mt) and Balboa ($7/mt), and down in Zona Comun ($4/mt)
• LSMGO prices up in New York, Los Angeles ($12/mt) and Balboa ($11/mt), and down in Houston ($14/mt) and Zona Comun ($7/mt)
• HSFO prices up in New York, Los Angeles ($7/mt) and Houston ($3/mt), and unchanged in Balboa

Defying Brent's upward movement, Houston’s LSMGO price has fallen, after a lower-priced 150–500 mt LSMGO stem, fixed at $607/mt, put downward pressure on the benchmark.

Recommended lead times in Houston for all three conventional fuel grades have been extended to at least seven days, as weather-related disruptions and congestion continue to affect deliveries, a source said.

New York’s LSMGO price has meanwhile gained the highest in the past day and is currently at premiums of $94/mt to Houston and $5/mt to Los Angeles.

The anchorage of Zona Común has also recorded a dip in both VLSFO and LSMGO prices.

Possible disruptions due to high wind gusts are expected at the anchorage until 17 January, a source tells ENGINE.

Bunkering operations are currently experiencing short delays due to rough weather conditions, while longer delays are expected from Friday. Advised lead times have been extended to around 8–10 days this week.

Brent

The front-month ICE Brent contract has gained $1.16/bbl on the day to trade at $66.31/bbl at 07.00 CST (13.00 GMT) today.

Upward pressure:

Rising unrest in Iran has continued to support Brent crude’s price this week.

In a social media post, US President Donald Trump has urged Iranians to continue demonstrations against the Islamic Republic’s regime led by Supreme Leader Ayatollah Ali Khamenei.

He also said that all meetings with Iranian officials had been cancelled, raising the prospect of a US intervention, market analysts noted.

“Markets are on high alert” following the latest escalation in Iran, according to Price Futures Group’s senior market analyst Phil Flynn.

Downward pressure:

Brent’s price has felt some downward pressure after the American Petroleum Institute (API) reported a huge surge in US crude stocks.

US crude oil inventories increased by a whopping 5.3 million bbls in the week ending 9 January, according to the API report.

Meanwhile, market analysts expected a draw of 2 million bbls.

A rise in US crude stocks can indicate lower demand for oil and put some downward pressure on Brent's price.

By Gautamee Hazarika and Aparupa Mazumder

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