Americas Market Update 15 July

Fuel prices across the Americas have mostly declined, while the National Hurricane Center has issued an advisory for Tropical Storm Elida.

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 08.00 CDT (13.00 GMT) today:

• VLSFO prices up in Los Angeles ($16/mt), and down in Zona Comun ($37/mt), Balboa ($35/mt), Houston ($26/mt) and New York ($16/mt)
• LSMGO prices up in Los Angeles ($21/mt), and down in Zona Comun ($123/mt), New York ($57/mt), Balboa ($40/mt) and Houston ($33/mt)
• HSFO prices down in Balboa ($17/mt), New York ($13/mt), Los Angeles ($10/mt) and Houston ($7/mt)

Houston's LSMGO price benchmark has declined after a lower-priced 150-500 mt stem, fixed at $1,133/mt, has put downward pressure on the benchmark.

Availability at the port is normal, with most suppliers able to deliver both grades within 5-7 days. HSFO may require slightly longer, a source said.

On the East Coast, New York's prices have declined across all three conventional fuel grades, with LSMGO recording the steepest drop. It is, nonetheless, at a premium of $119/mt to Houston, making the latter a cheaper option for bunkering the grade.

Weather conditions in New York are stable, with no backlog congestion reported at the moment. A period of strong wind gusts is expected at the port between 15-19 July, a trader said.

The Atlantic hurricane season is currently underway, and the National Hurricane Center has issued an advisory for Tropical Storm Elida in the Eastern Pacific.

Brent

The front-month ICE Brent contract has lost $2.08/bbl on the day, to trade at $85.08/bbl at 08.00 CDT (13.00 GMT) today.

Upward pressure:

Brent crude has continued to trade well above $80/bbl mark as tension in the Middle East remained fairly elevated.

Another commercial vessel came under attack while transiting the Strait of Hormuz, 13 nautical miles (NM) southeast of Limah, Oman yesterday, the United Kingdom Maritime Trade Operations (UKMTO) reported.

“Observable traffic in the strait [of Hormuz] all but ceased,” ANZ Bank’s senior commodity strategist Daniel Hynes said.

Earlier this week, a tanker was approached by six small boats about 50 NM south of Aden, Yemen. One small boat has fired warning shots, the UKMTO reported. “The other 5 small boats have remained at 1NM,” it added.

“The recent attacks on ships by both Iran and the US are making these journeys increasingly risky,” Hynes added.

Downward pressure:

Brent’s rally has lost some steam after US President Donald Trump cancelled plans to impose a 20% fee of a cargo’s value for the US to assist in safely transiting the Strait of Hormuz.  

Trump walked back from his previous comments, replacing the 20% “reimbursement fee” with trade deals with the various Gulf countries.

Oil broke above $85/bbl earlier this week after Trump proposed the fee and named the US “guardian of the Hormuz Strait.”

The US President did not disclose the specifics of the trade and investment deals that he claims Gulf nations will be striking with Washington.

Washington is signalling that “it is willing to compromise,” after Trump backed away from his latest plan, Hynes remarked.

By Gautamee Hazarika and Aparupa Mazumder

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