Americas Market Update 8 June

Fuel prices have moved in mixed directions, and the Hurricane Center has issued an advisory on Tropical Storm Boris.

IMAGE: Container ship leaving the Port of Houston at Morgan's Point. Getty Images.

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

• VLSFO prices up in Balboa ($79/mt) and Los Angeles ($37/mt), and down in New York ($32/mt), Houston ($16/mt) and Zona Comun ($2/mt)
• LSMGO prices up in Balboa ($71/mt) and down in Los Angeles ($51/mt), Houston ($15/mt) and New York ($2/mt)
• HSFO prices up in Los Angeles ($26/mt) and Balboa ($11/mt), unchanged in Houston, and down in New York ($17/mt)

Prices of all grades at Balboa have recorded gains, with VLSFO posting the largest gain and HSFO the smallest.

These price movements have widened the port's Hi5 spread to $81/mt today, up from $13/mt on Friday.

Conversely, Houston's VLSFO price has declined over the past session while its HSFO price remains unchanged. The Hi5 spread at the port has thus narrowed to $86/mt from $102/mt on Friday.

Fuel demand in Houston is strong across all three conventional fuel grades. Availability has been tight for prompt deliveries this week, with HSFO and VLSFO requiring 8-10 days of lead time, while LSMGO can be delivered within 5-7 days.

Heavy congestion and delays have been reported at the loading terminals over the past few weeks, a source said.

The hurricane season has begun, and the National Hurricane Center has issued an advisory on Tropical Storm Boris, which is located just offshore the southern coast of Mexico.

Brent

The front-month ICE Brent contract has lost by $0.01/bbl on the day from Friday, trading at $94.69/bbl at 08.00 CDT (13.00 GMT) today.

Upward pressure:

Brent crude’s price has opened the week on a higher note after Israel and Iran engaged in hostilities over the weekend.

On Sunday, Israel struck a Hezbollah-controlled command centre in Beirut, Lebanon, its defense forces said. The attack came after the Lebanon-based militant group targeted northern Israel with missiles.

Hours later, Iran and Israel exchanged fire, with the Israel Defense Forces (IDF) striking military sites in western and central Iran.

The attacks have reignited disruption concerns as market analysts flagged its impact on the ongoing peace negotiations between the US and Iran.

“Every military response forces [oil] traders to widen the range of possible outcomes,” SPI Asset Management managing partner Stephen Innes noted.

Downward pressure:

Brent crude’s price has felt some downward pressure after Baker Hughes reported a rise in US crude oil rig activity.

The total number of rigs drilling for crude oil in the US increased by two to 431 units last week.

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.

By Gautamee Hazarika and Aparupa Mazumder

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