Americas Market Update 28 Aug

Bunker fuel prices have moved in mixed directions, and weather conditions in Los Angeles are conducive for bunkering this week.

IMAGE: Aerial shot of a container ship arriving in the Port of Long Beach. Getty Images

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

• VLSFO prices up in Balboa ($10/mt) and Zona Comun ($6/mt), and down in Los Angeles, Houston and New York ($10/mt)
• LSMGO prices up in Zona Comun ($28/mt), Balboa ($15/mt) and Los Angeles ($3/mt), and down in New York ($10/mt) and Houston ($8/mt)
• HSFO prices up in Balboa ($33/mt), and down in Los Angeles ($11/mt), New York ($2/mt) and Houston ($1/mt)

Balboa's HSFO price has increased the most for the grade, compared to other key ports in the Americas, after a higher-priced 1,500 mt stem, fixed at $642/mt, put upward pressure on the benchmark.

VLSFO and LSMGO can be supplied at the Panamanian port within 3–6 days, while HSFO requires 7–8 days.

Los Angeles' VLSFO price benchmark has declined after a lower-priced, 150–500 mt stem, fixed at $889/mt, weighed the benchmark down.

The port has good weather this week, which is conducive to bunkering, a source said.

VLSFO and LSMGO availability is tight, with lead times of more than a week to 10 days. HSFO is relatively more available but requires at least a week's notice.

Brent

The front-month ICE Brent contract has gained by $0.53/bbl on the day, trading at $89.09/bbl at 08.00 CDT (13.00 GMT) today.

Upward pressure:

Brent crude’s price has risen after Tehran blacklisted 45 vessels and threatened to impose hefty penalties on those that violate its regulations for transiting the Strait of Hormuz.

The announcement comes after Washington vowed sweeping economic sanctions against Tehran, in a bid to drive the OPEC producer’s oil and petroleum product export revenues to zero.

The US announced nearly 60 Iran-related sanctions and threatened of secondary sanctions on the Islamic Republic’s international allies – like China. 

“Oil prices edged higher as prospects for renewed US-Iran talks diminished,” two analysts from ING Bank noted.

Downward pressure:

Brent’s price has felt some downward pressure following a surprise build in US crude stocks.

Commercial US crude oil inventories increased by 95,000 bbls to 429 million bbls in the week ending 21 August, according to data from the US Energy Information Administration (EIA).

The data followed a bigger build of 4.2 million bbls, reported by the American Petroleum Institute (API) during the same week.

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

By Gautamee Hazarika and Aparupa Mazumder

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