East of Suez Market Update 23 July

Prices in East of Suez ports have risen, and VLSFO availability remains tight in Singapore.

IMAGE: Bunker delivery in Singapore. Getty Images

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

• VLSFO prices up in Singapore ($39/mt), Fujairah ($14/mt) and Zhoushan ($10/mt)
• LSMGO prices up in Singapore ($40/mt), Zhoushan ($18/mt) and Fujairah ($9/mt)
• HSFO prices up in Singapore ($23/mt), Fujairah ($16/mt) and Zhoushan ($11/mt)
• B30-VLSFO price up in Singapore ($35/mt)

Singapore's VLSFO price has jumped by $39/mt over the past day, marking the sharpest increase among Asia's three major bunker hubs. The rally has shifted Singapore's VLSFO from a $15/mt discount to Zhoushan to a $14/mt premium, although it still trades at a $15/mt discount to Fujairah.

Prompt VLSFO supply in Singapore remains constrained, with suppliers continuing to recommend lead times of 14-19 days, broadly unchanged from last week. Supply tightness persists as the port's fuel oil inventories have not yet recovered to pre-conflict levels, while cargo inflows remain limited due to renewed US-Iran hostilities disrupting vessel traffic through the Strait of Hormuz.

In Australia, bunker deliveries via pipeline to Dampier Cargo Wharf (DCW) have been suspended until approximately the end of September while repair works are carried out. Limited truck-based deliveries will be available, subject to vessel size. In the meantime, a supplier has identified Toll Supply Base (TSB) in Dampier as the preferred alternative for bunker supply, according to a source.

Brent

The front-month ICE Brent contract has jumped $3.53/bbl on the day, to trade at $97.82/bbl at 17.00 SGT (09.00 GMT) today.

Upward pressure:

Brent crude is trading close to the $100/bbl threshold as the US-Iran conflict has effectively spread to the Red Sea.

Yemen’s Iran-backed Houthi militants have targeted two oil tankers – the Encelia and Layla – in the Bab al-Mandeb Strait for violating their maritime embargo on Saudi Arabian oil shipments.

Meanwhile, US President Donald Trump has made it clear that US military action in the region will be further ramped up, as the conflict shows no sign of de-escalation.

“Any time the Islamic Republic of Iran shoots at a ship in the Strait of Hormuz… the United States will bomb and destroy ONE BRIDGE OR POWER PLANT,” Trump wrote on social media platform Truth Social.

Downward pressure:

Brent’s price came under some downward pressure after the US Energy Information Administration (EIA) reported an increase in US crude stocks.

US crude oil inventories gained by 2 million bbls to 411.7 million bbls in the week ending 17 July, according to data from the EIA. A build in US crude stocks can indicate lower demand for oil.

By Tuhin Roy and Aparupa Mazumder

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