East of Suez Market Update 22 Oct

Most prices in East of Suez ports have moved higher, and Zhoushan’s Hi5 spread has widened amid a bunkering suspension at the port.

IMAGE: Night scene of Zhoushan, close to the dock on Putuo island. Getty Images

Changes on the day to 17.00 SGT (09.00 GMT) today:

• VLSFO prices up in Zhoushan ($36/mt), Fujairah ($17/mt) and Singapore ($8/mt)
• LSMGO prices up in Zhoushan ($67/mt), Singapore ($28/mt), and down in Fujairah ($24/mt)
• HSFO prices up in Singapore ($21/mt), Fujairah ($9/mt) and Zhoushan ($8/mt)

A $36/mt climb in Zhoushan’s VLSFO price has pushed the grade’s premium over Singapore higher by $28/mt, to $36/mt from $8/mt yesterday. Its discount to Fujairah has narrowed to $16/mt from $35/mt yesterday.

Zhoushan’s LSMGO price has gained $67/mt, widening its premium over Singapore to $141/mt from $102/mt yesterday. Its discount to Fujairah has narrowed to $263/mt from $354/mt yesterday.

Zhoushan’s Hi5 spread has also widened on the day, to $86/mt today from $58/mt yesterday. It remains above Singapore’s $44/mt and below Fujairah’s $209/mt.

Bunker operations across Zhoushan have been completely suspended due to rough weather caused by Typhoon Champi, according to a source. Some suppliers now recommend lead times of around 13 days for VLSFO and around 11 days for HSFO.

Brent

The front-month ICE Brent contract has risen by $2.24/bbl on the day, to trade at $112.37/bbl, at 17.00 SGT (09.00 GMT) today.

Upward pressure:

Brent futures have risen amid escalating tensions in the Middle East. Yemen-based Houthis struck several sites in Saudi Arabia on Wednesday, including King Fahd International Airport in Dammam, according to media reports. Saudi air defences intercepted a drone that was approaching a facility at Saudi Aramco’s Shaybah oilfield, Al Jazeera reported.

Following these attacks, the US administration has ordered some diplomats and their families to leave Saudi Arabia.

“Oil prices remain well bid, with ICE Brent back above $110/bbl this morning, following additional deadly attacks on Saudi Arabia,” analysts from ING Bank said.

Commercial US crude oil inventories fell by 3.1 million bbls to 412.5 million bbls in the week ending 16 October, according to data from the US Energy Information Administration (EIA). A decline in US crude stocks typically signals stronger demand and can offer some support to Brent’s price.

Downward pressure:

A sharp rise in Brent futures has been tempered by hopes of a breakthrough in US-Iran talks, aimed at resolving the Middle East conflict.

“Iran is prepared to give diplomacy another chance if we see strong evidence of a sincere desire by US to build trust & reach a just solution,” Iran’s foreign minister, Abbas Araghchi said on the social media platform X.

Additionally, the International Energy Agency (IEA) has expressed its willingness to release more oil from emergency stocks amid concerns over supplies from the Middle East.

By Konica Bhatt and Shilpa Sharma

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