East of Suez Market Update 9 Sep

Most prices in East of Suez ports have risen, and availability is tight across all grades in the UAE ports of Fujairah and Khor Fakkan.

IMAGE: Bunker barge at berth in Fujairah, UAE. Port of Fujairah

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

• VLSFO prices up in Fujairah ($21/mt), Singapore ($5/mt) and Zhoushan ($4/mt)
• LSMGO prices up in Singapore ($13/mt), Zhoushan ($9/mt), and down in Fujairah ($9/mt)
• HSFO prices up in Singapore ($7/mt), Zhoushan ($6/mt), and down in Fujairah ($8/mt)
• B30-VLSFO price up in Singapore ($13/mt)

Fujairah’s VLSFO price has increased by $21/mt over the past day, the sharpest rise among the three major Asian bunker ports. The increase has eliminated Fujairah’s VLSFO discount to Zhoushan, while the benchmark's price has shifted from near parity with Singapore to a premium of $18/mt.

US-Iran tensions over the Strait of Hormuz continue to disrupt bunker fuel availability in Fujairah. Supplies of all major grades are described as “super tight”, with fuel oil imports falling sharply amid heightened regional tensions.

Tight supply conditions are also being reported at the nearby port of Khor Fakkan, where availability across all grades remains constrained, according to a Middle East-based source.

In Saudi Arabia, VLSFO and LSMGO availability in Jeddah remains steady. At Qatar’s Ras Laffan, however, bunker supply continues to be restricted, with both VLSFO and LSMGO in limited supply.

Brent

The front-month ICE Brent contract has gained by $1.12/bbl on the day, to trade at $100.36/bbl at 17.00 SGT (09.00 GMT) today.

Upward pressure:

Brent crude’s price has continued to climb, surpassing the $100/bbl mark, as tensions in the Persian Gulf escalate.

The US Central Command (CENTCOM) carried out additional strikes on Iran-linked oil tankers yesterday, hitting five vessels in response to Tehran targeting a US Navy warship.

“The oil market continues to move higher this morning as the Middle East tension escalates,” two analysts from ING Bank noted.

One vessel, M/T Riesco, sank in the Gulf of Oman, CENTCOM noted.

“Recent developments only reinforce the view that we’re still some way from a restart in talks,” ING Bank’s analysts added.

Downward pressure:

While Brent’s price is under limited downward pressures today, market participants are eyeing US crude inventory data that is scheduled for release later this week.

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

The crude stocks report has been delayed this week due to the US Labour Day holiday.

By Tuhin Roy and Aparupa Mazumder

Please get in touch with comments or additional info to news@engine.online