East of Suez Market Update 30 Sep

Prices in East of Suez ports have fallen across all grades, and availability of VLSFO and HSFO 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 down in Zhoushan ($72/mt), Fujairah ($19/mt) and Singapore ($16/mt)
• LSMGO prices down in Zhoushan ($77/mt), Fujairah ($47/mt) and Singapore ($24/mt)
• HSFO prices down in Zhoushan ($29/mt), Singapore ($9/mt) and Fujairah ($8/mt)
• B30-VLSFO prices down in Singapore ($27/mt)

Singapore's VLSFO price has slipped by $16/mt to $836/mt, the smallest fall among the three major Asian bunker ports. The price now stands at a $70/mt discount to Fujairah and a $68/mt discount to Zhoushan. Singapore's discount to Zhoushan has narrowed sharply from $124/mt a day earlier, as Zhoushan's price dropped by $72/mt, while its discount to Fujairah has eased only slightly, from $73/mt.

Singapore's LSMGO price has fallen by $24/mt to $1,251/mt, and its HSFO price has dropped by $9/mt to $713/mt. HSFO in Singapore now stands at a $34/mt premium over Fujairah and a $122/mt discount to Zhoushan. B30-VLSFO in Singapore has declined by $27/mt to $1,025/mt.

Singapore's bunker market remains tight even though demand is “below average,” with advised VLSFO lead times shortening to 10-15 days, from 13-17 days a week earlier. Most suppliers are keeping stocks low, and that late cargo arrivals linked to the conflict in the Middle East are adding to the strain, a Singapore-based source said.

HSFO availability has tightened further, with advised lead times lengthening to 10-15 days, from 9-12 days last week. LSMGO is comparatively well supplied, with lead times of about five days, compared with 5-7 days previously.

In Malaysia's Port Klang, supply is still constrained across several grades. Prompt VLSFO is especially tight, LSMGO availability is limited, and HSFO supply remains under pressure.

Brent

The front-month ICE Brent contract has lost by $1.57/bbl on the day, to trade at $103.67/bbl at 17.00 SGT (09.00 GMT) today.

Upward pressure:

Brent crude’s price has continued to trade well above the $100/bbl threshold, after US President Donald Trump dismissed claims of easing economic sanctions on Iran.

Media reports suggesting that Trump has offered to release frozen Iranian funds, in exchange for Tehran to reopen the Strait of Hormuz to commercial navigation, are false, Trump said on social media platform Truth Social.

The statement comes amid stalled mediation efforts between Washington and Tehran, following a complete absence of diplomatic breakthrough at the United Nations General Assembly summit in New York earlier this month.

Notably, Tehran has actively demanded that the White House releases its frozen assets in order to restore vessel movement through the Strait of Hormuz back to normalcy.

Oil prices remain more than 60% higher year-to-date, amid the ongoing escalation in the Middle East, that has now pulled Saudi Arabia into it, two analysts from ING Bank noted.

Downward pressure:

Brent crude’s price has felt some downward pressure after the American Petroleum Institute (API) reported a rise in US crude stocks.

US crude oil inventories increased by 1.02 million bbls in the week ending 25 September, the API reported.

Market analysts had expected an inventory draw of 578,000 b/d instead, ING Bank’s analysts added.

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

By Tuhin Roy and Aparupa Mazumder

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