Americas Market Update 11 Nov

Bunker prices have moved in mixed directions, and strong wind gusts are forecast in New York through Friday.

IMAGE: An aerial view of a container ship passing through New York. The port of New York and New Jersey

Changes on the day to 07.00 CST (13.00 GMT) today:

• VLSFO prices up in Zona Comun ($62/mt), New York ($39/mt), Balboa ($34/mt) and Houston ($29/mt)
• LSMGO prices up in Zona Comun ($120/mt), Houston ($65/mt), New York ($17/mt) and Balboa ($10/mt)
• HSFO prices up in Balboa ($29/mt) and Houston ($19/mt), and down in New York ($3/mt)

New York’s VLSFO price has increased over the past day, while the port’s HSFO price has declined despite a rise in Brent.

This has widened the port’s Hi5 spread to $195/mt today from $153/mt yesterday. The spread is now at its widest since last Wednesday, when it stood at $204/mt.

Demand is high at the port and availability of all three conventional grades is good, with no severe tight spots reported.

Recommended lead times for VLSFO and LSMGO are 2-4 days, and HSFO can be delivered with around five days’ notice.

Strong wind gusts are forecast in New York until Friday and could disrupt port operations and cause delays. Barge congestion is not expected, although suppliers may require vessels to stand by in the strong winds, a source said.

Brent

The front-month ICE Brent contract has gained $3.12/bbl on the day, trading at $93.05/bbl at 07.00 CST (13.00 GMT) today.

Upward pressure:

Brent futures have rebounded, following a report of a fresh attack on a tanker near the Strait of Hormuz. The United Kingdom Maritime Trade Operations (UKMTO) agency reported on Tuesday that a vessel was struck by an unknown projectile, approximately 19 nautical miles (NM) northeast of Lima, Oman.

The agency has advised vessels to transit with caution.

Iran's Revolutionary Guards Navy said, on Tuesday, that two tankers caught fire after striking naval mines while transiting the Strait of Hormuz, Reuters reported.

Additionally, Iran has denied US claims that negotiations on reopening the Strait of Hormuz are continuing. Iran’s Security Council chief Mohsen Rezaei said, “The US' claim about continuing negotiations or holding a meeting in Qatar is a pure lie,” state-owned news agency IRNA reported.

Downward pressure:

US crude oil inventories increased by 9 million bbls in the week ending 6 November, according to estimates from the American Petroleum Institute (API), as cited by Trading Economics.

A rise in US crude stocks usually indicates lower demand and can put downward pressure on Brent’s price. The market is now awaiting official inventory data from the US Energy Information Administration (EIA), which is due to be released tomorrow.

Senior officials from Russia and Ukraine met in Abu Dhabi on Tuesday for US-brokered peace talks, marking their first such meeting since February, Reuters reported.

By Gautamee Hazarika and Shilpa Sharma

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