Americas Market Update 7 Apr

Fuel prices have mostly risen, and bunkering operations in GOLA are suspended due to adverse weather conditions.

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 Houston, Los Angeles ($45/mt) and New York ($22/mt), and down in Balboa ($23/mt)
• LSMGO prices up in Balboa ($74/mt), Los Angeles ($69/mt), New York ($36/mt) and Houston ($17/mt)
• HSFO prices up in Los Angeles ($57/mt), Houston ($27/mt) and New York ($20/mt), and down in Balboa ($5/mt)

Fuel prices across key ports have mostly tracked Brent's upward movement, except for HSFO and VLSFO at the port of Balboa, where prices have dipped over the past day.

The port's VLSFO price dip may have been influenced by a lower-priced 500–1500 mt stem, fixed at $877/mt, exerting downward pressure on the benchmark. The Hi5 spread currently stands at $143/mt, down from $161/mt yesterday.

Houston and Los Angeles, meanwhile, have recorded the highest gains for VLSFO.

Houston is currently at a premium of $94/mt to New York and a discount of $245/mt to Los Angeles for the grade.

Bunker fuel demand in Houston remains firm, with availability tight across all three conventional fuel grades of HSFO, VLSFO and LSMGO.

Suppliers are recommending lead times of around 8–12 days, depending on enquiry size and grade requirements, a bunker trader tells ENGINE.

In the nearby anchorage of Galveston Offshore Lightering Area (GOLA), bunkering operations have been suspended due to high wind gusts and elevated seas.

Operations are expected to resume shortly; however, delays are likely to continue through 10 March, a source said.

Brent

The front-month ICE Brent contract has gained $2.61/bbl on the day, to trade at $110.88/bbl at 08.00 CDT (13.00 GMT) today.

Upward pressure:

Brent crude’s price has moved higher after US President Donald Trump set a new deadline for Iran to strike a deal and reopen the Strait of Hormuz.

“Oil prices rose after US President Donald Trump signalled that an escalation of strikes on Iran could come as soon as Tuesday,” two analysts from ING Bank noted.

Trump warned in a social media post that US forces will target power plants and bridges after 20:00 ET (00:00 GMT midnight) today if Washington’s demands are not met.

Oil prices gained, “renewing fears that oil flows through the Strait of Hormuz could remain constrained for longer,” ING Bank’s analysts added.

Downward pressure:

Brent’s price has felt some downward pull after eight members of the Organization of the Petroleum Exporting Countries and its allies (OPEC+) collectively agreed to increase oil output by 206,000 b/d in May.

The output hike decision comes amid the escalating US-Israeli conflict with Iran that has triggered repeated strikes on energy infrastructure across the Middle East and effectively choked off traffic through the Strait of Hormuz.

“OPEC+ raised output targets by 206k b/d [206,000 b/d] in May, a largely symbolic move as the war continues to constrain output and shipments from several key members,” ING Bank’s analysts added.

By Gautamee Hazarika and Aparupa Mazumder

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