Americas Market Update 14 Oct

Fuel prices have moved in mixed directions, and bunker demand has been strong at the West coast ports.

IMAGE: Cargo containers being offloaded in the Port of Los Angeles. Getty Images

Changes on the day to 08.00 CDT (13.00 GMT) today:

• VLSFO prices up in Zona Comun ($54/mt), Houston and Balboa ($4/mt) and New York ($3/mt), and down in Los Angeles ($1/mt)
• LSMGO prices up in Houston ($19/mt) and New York ($11/mt), unchanged in Los Angeles, and down in Balboa ($6/mt)
• HSFO prices up in New York ($3/mt) and Houston ($2/mt), and down in Balboa ($14/mt) and Los Angeles ($2/mt)

Balboa’s HSFO price has recorded the highest decline amongst the major Americas ports over the past day, after a lower-priced, 500-1,500 mt stem, fixed at $715/mt, possibly weighed the benchmark down.

Bunker fuel availability in Panama is normal. All three conventional grades are deliverable within 3-6 days at Balboa and Cristobal, a supplier said.

Despite remaining unchanged over the past session, Los Angeles' LSMGO price is trading at premiums of $229/mt to Houston and $93/mt to New York.

Demand at the West Coast ports have been strong this week, a source said. Suppliers recommend lead times of 3-7 days for HSFO and LSMGO, while VLSFO is available within 5-7 days.

Brent

The front-month ICE Brent contract has gained $0.08/bbl on the day, trading at $105.48/bbl at 08.00 CDT (13.00 GMT) today.

Upward pressure:

Brent crude’s price has found support after more vessels came under attack in the Strait of Hormuz, while Iran signalled it would step up its campaign against shipping.

A container ship and a tanker have been struck by unknown projectiles within the Strait of Hormuz since yesterday, the United Kingdom Maritime Trade Operations (UKMTO) agency reported.

“Iranian attacks on tankers transiting the Strait of Hormuz showed no signs of easing,” ANZ Bank’s senior commodity strategist Daniel Hynes said.

Iranian officials told Reuters they are deploying new tactics to target ships, in a bid to keep oil prices high and influence next month’s US midterm elections.

“According to data from the UK Maritime Trade Operations, 24 ships were hit in the two weeks to 11 October,” Hynes added.

An administrative building belonging to Saudi Arabia’s state-owned oil company Aramco in Dhahran was also attacked yesterday, causing a fire, Reuters reported citing the country’s energy ministry.

Downward pressure:

Brent’s gains have been capped by some signs of recovering oil flows out of the Persian Gulf.

The US Central Command (CENTCOM) said it had helped ship more than 19 million bbls of crude through the Strait of Hormuz yesterday.

Traders are also weighing the prospect of more diesel supply from Russia.

By Gautamee Hazarika and Aparupa Mazumder

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