Americas Market Update 20 Jan

Bunker fuel prices across the Americas have mostly moved upwards, and a small craft advisory is in effect in New York due to high wind gusts.

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

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

• VLSFO prices up in Houston ($17/mt), Balboa ($7/mt), New York ($5/mt), Zona Comun ($4/mt) and Los Angeles ($2/mt)
• LSMGO prices up in Zona Comun ($24/mt), Balboa ($22/mt), Houston ($17/mt), New York ($14/mt) and Los Angeles ($5/mt)
• HSFO prices up in New York ($10/mt), Houston ($7/mt), unchanged in Balboa, and down in Los Angeles ($3/mt)

Houston's VLSFO price has gained the most within the grade and is currently at a discount of $41/mt to New York, compared to $53/mt yesterday.

Recommended lead times for all three conventional fuel grades in Houston are at 7–10 days this week, while some suppliers have advised additional lead times, particularly for HSFO.

In New York, extremely cold weather has led to some delays in supply and deliveries, a trader told ENGINE.

Additionally, a small craft advisory has been in effect due to high wind gusts and is set to remain until today afternoon, which can potentially delay transits of small vessels, such as barges.

Zona Comun’s LSMGO price has gained by the highest measure over the past day. Availability of the grade has remained decent at the anchorage, with lead times standing at around 5–7 days.

Bunkering operations at the anchorage had been suspended over the weekend and resumed early Monday morning, a source said.

Brent

The front-month ICE Brent contract has gained $0.69/bbl on the day, to trade at $64.42/bbl at 07.00 CST (13.00 GMT) today.

Upward pressure:

Brent crude’s price has inched higher as a weaker US dollar provided some support to the broader commodities complex, according to two analysts from ING Bank.

“Commodities performed relatively well… as a weaker USD proved supportive,” ING Bank’s analysts said.

The gains come as trade tensions between the US and Europe intensify, after President Donald Trump called for the “complete and total purchase” of Greenland.

Besides, the sustained strength in ICE Brent time spreads will lend further support to prices, as it points to tightening conditions in the spot physical market, the two analysts added.

Downward pressure:

The total number of rigs drilling for crude oil in the US rose by one to 410 units last week, according to Baker Hughes.

The US oil rig count is seen as an indicator of future oil production. It reflects how much oil drilling activity is happening, or expected to happen, in the shale sector.

In an oversupplied market, any signal of increased future supply can put downward pressure on Brent’s price.

By Gautamee Hazarika and Aparupa Mazumder

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