Americas Market Update 25 Aug

Fuel prices across the Americas have recorded declines, and elevated sea conditions are expected to disrupt bunker operations off Trinidad.

IMAGE: The Atlantic entrance to the Panama Canal. Getty Images

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

• VLSFO prices down in Balboa ($51/mt), Los Angeles ($32/mt), New York ($29/mt), Zona Comun ($26/mt) and Houston ($18/mt)
• LSMGO prices down in Balboa ($96/mt), Zona Comun ($49/mt), Houston ($48/mt), Los Angeles ($45/mt) and New York ($36/mt)
• HSFO prices down in Balboa ($52/mt), Los Angeles ($26/mt), Houston ($21/mt) and New York ($16/mt)

Balboa's HSFO price has declined the most for the grade compared with other key ports in the Americas. A lower-priced, 500-1,500 mt stem, fixed at $603/mt, has put downward pressure on the benchmark.

The port's VLSFO price has also declined the most for the grade over the past day. A lower-priced, 500-1,500 mt stem, fixed at $737/mt, weighed on the benchmark.

Bunker demand has seen a small uptick from the previous week at the ports of Balboa and Cristobal, a trader said. Availability is steady, with all three fuel grades available with lead times of 5-7 days.

Off Trinidad, bunkering operations have faced disruptions due to high seas near the bunkering locations. These disruptions could result in delays until tomorrow, a trader said.

Brent

The front-month ICE Brent contract has lost by $4.00/bbl on the day, trading at $89.21/bbl at 08.00 CDT (13.00 GMT) today.

Upward pressure:

Brent’s price has managed to trade above the $90/bbl mark, as oil flow through the Strait of Hormuz continues to remain severely choked.

As of yesterday, only four commercial ships transited the strait, with one vessel navigating the passage with its AIS transponder switched off, market intelligence provider Windward reported.

This meagre count marks a staggering plunge from pre-war traffic levels, which typically hovered around 140 daily transits.

“Persian Gulf producers have partially offset the impact of the Strait of Hormuz disruption by relying on alternative export routes, but these remain fragile,” ANZ Bank’s senior commodity strategist Daniel Hynes said.

Downward pressure:

Brent crude’s price has declined this morning, as the oil market seems largely unfazed by the US’ economic campaign against Iran, market analysts said.

“Oil prices drifted lower… despite renewed US plans to tighten economic pressure on Iran,” two analysts from ING Bank said.

The US announced nearly 60 Iran-related sanctions and threatened imposing secondary sanctions on international allies who continue trading with Iran.

Yet, the oil market remains sceptical about how severely these measures will actually constrict global crude flows and demand growth.

Oil traders are viewing Washington’s “effort to nudge partners away from Iranian trade as marginal rather than market‑moving,” ING Bank’s analysts remarked.

By Gautamee Hazarika and Aparupa Mazumder

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