Americas Market Update 26 Nov

Fuel prices have declined across major hubs in the Americas, and thick fog in Houston is disrupting bunkering operations.

IMAGE: A tugboat in the Houston area. Getty Images

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

• VLSFO prices down in Zona Comun ($16/mt), Los Angeles ($14/mt), Houston ($9/mt), Balboa ($8/mt) and New York ($7/mt)
• HSFO prices down in Balboa ($27/mt), Houston ($20/mt), New York ($17/mt) and Los Angeles ($8/mt)
• LSMGO prices down in Balboa ($35/mt), Houston ($34/mt), Zona Comun ($25/mt), Los Angeles ($19/mt) and New York ($15/mt)

Fuel prices have fallen significantly across all key hubs in the past day.

Balboa's LSMGO benchmark has dipped the most, and its nearby bunkering hubs, Cartagena and Barranquilla, are at premiums of $59/mt and $147/mt, making the Panamanian port a more favourable spot to offtake the grade.

The price of HSFO at Balboa recorded the steepest decline amongst the ports in the past session.

Houston's HSFO price decreased by $20/mt, while New York's HSFO price followed with a $17/mt decline.

The price movements over the past month have put Houston at a $50/mt discount to New York, which is a sharp rise from the $5/mt discount Houston held a month ago.

The port of Houston is experiencing the onset of the US Gulf's fog season, and dense fog has been affecting bunker operations, particularly delaying barge movements, a source told ENGINE.

In Argentina, Zona Comun has also seen VLSFO and LSMGO prices fall by $16/mt and $25/mt respectively. The anchorage currently has favourable weather, but high wind gusts are forecast between 28–30 November, which could disrupt operations.

Brent

The front-month ICE Brent contract has gained $0.08/bbl on the day, to trade at $62.29/bbl at 07.00 CST (13.00 GMT) today.

Upward pressure:

Brent crude’s price has gained some support after the American Petroleum Institute (API) reported a decline in US crude stocks.

Crude oil inventories in the US decreased by 1.9 million bbls in the week ending 21 November, according to the API estimates.

A drop in US crude stocks typically indicates higher demand and can lend some support to Brent's price.

Downward pressure:

Brent crude has edged lower as momentum builds around advancing peace negotiations between Russia and Ukraine.

According to media reports, Ukraine has agreed to the preliminary terms of the revised US-brokered ceasefire proposal to end the conflict – which has continued for nearly four years now.

“Positive signals from both the US and Ukraine regarding a Russia-Ukraine peace deal continue to put pressure on energy markets,” two analysts from ING Bank said.

Oil market analysts now await comments from Moscow. “We are likely to get more colour on Russia’s stance in the coming days,” ING Bank’s analysts added.

By Gautamee Hazarika and Aparupa Mazumder

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