Americas Market Update 12 June

Fuel prices have moved in the downward direction, and bunker availability is good at the Panamanian ports of Balboa and Cristobal.

IMAGE: Vessel docked in the Port of Houston in the US. Port of Houston.

Changes on the day to 08.00 CDT (13.00 GMT) today:

• VLSFO prices down in Los Angeles ($77/mt), Balboa ($62/mt), Zona Comun ($44/mt), Houston ($34/mt) and New York ($27/mt)
• LSMGO prices down in Balboa ($86/mt), Zona Comun ($69/mt), New York ($52/mt), Houston ($42/mt) and Los Angeles ($27/mt)
• HSFO prices down in Balboa ($44/mt), Houston ($41/mt), Los Angeles ($33/mt) and New York ($20/mt)

Los Angeles' VLSFO price recorded the steepest decline for the grade. Nonetheless, the port is at premiums of $162/mt to Houston and $126/mt to New York.

On the US West Coast, fuel availability across all three conventional grades is normal at the ports of Los Angeles and Long Beach. Recommended lead times for HSFO, VLSFO and LSMGO are 7–10 days this week, a trader tells ENGINE.

Balboa's HSFO price has declined the most among the major ports for the grade. Meanwhile, the port's VLSFO prices have fallen more than its HSFO price, narrowing the port's Hi5 spread to $30/mt today from $48/mt on Thursday.

Availability is good at both Balboa and Cristobal, with recommended lead times of 3–4 days for VLSFO and LSMGO. HSFO requires slightly longer lead times of 4–5 days.

Brent

The front-month ICE Brent contract has lost by $5.00/bbl on the day, trading at $88.13/bbl at 08.00 CDT (13.00 GMT) today.

Upward pressure:

Brent crude’s price has felt some upward pressure, following weekly US crude inventory reports that indicated a substantial decline.

Commercial US crude oil inventories decreased by 7.2 million bbls to 426.5 million bbls in the week ending 5 June, according to data from the US Energy Information Administration’s (EIA).

“This [EIA report] is the seventh consecutive week of declines,” two analysts from ING Bank noted.

The American Petroleum Institute (API) reported an even larger draw of 9.1 million bbls during the same week.

A decline in US crude stocks indicates tightness in the oil market and has put some upward pressure on Brent's price.

“Commercial [US] crude oil inventories stand at a little over 426m barrels [426 million bbls], around 5% below the seasonal 5-year average,” ING Bank’s analysts said.

Downward pressure:

Brent crude’s price has plunged by more than $5/bbl following remarks by US President Donald Trump, indicating that the time and place to sign a US-Iran peace deal will be “announced shortly”.

The US President said he is halting hostilities in the Middle East region as Washington prepares to announce that details regarding a potential US-Iran peace deal soon.

“There does appear to be more positive noise around the deal this time, not just from the US, but also from other parties involved in the negotiations,” ING Bank’s analysts said.

Saudi Arabia-led oil producers group OPEC has slashed oil demand growth forecast once again, as the ongoing conflict in the Middle East continues to reshape energy consumption patterns.

The Organization of the Petroleum Exporting Countries (OPEC) has cut its global oil demand growth projection for 2026 to about 1.0 million b/d – around 200,000 b/d lower than its previous estimate.

“Most other agencies forecast a contraction in demand this year amid supply disruptions in the Middle East,” ING Bank’s analysts added.

By Gautamee Hazarika and Aparupa Mazumder

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