Americas Market Update 22 Oct

Fuel prices have mostly moved in the upwards direction, and bunker demand is strong in New York.

IMAGE: Container ship traffic in Los Angeles' Pier 300 Channel. Port of Los Angeles

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

• VLSFO prices up in Zona Comun ($37/mt), Los Angeles ($22/mt), Houston ($19/mt) and New York ($16/mt), and unchanged in Balboa
• LSMGO prices up in Zona Comun ($66/mt), Los Angeles ($38/mt), New York ($32/mt) and Houston ($21/mt), and down in Balboa ($6/mt)
• HSFO prices up in Los Angeles ($14/mt), Houston ($12/mt), New York ($8/mt) and Balboa ($6/mt)

Los Angeles’ HSFO price has recorded the largest daily gain for the grade across major ports in the Americas. The port's VLSFO price has risen by $8/mt more than its HSFO, widening the port's Hi5 spread to $164/mt today from $156/mt yesterday.

Despite New York recording price gains across all the three fuel grades over the past session, Los Angeles' VLSFO continues to trade at a premium over New York, with today's premium widening to $255/mt.

Bunker demand has increased in New York over the past week, a source said.

Prompt VLSFO and HSFO supply is tight, with both grades requiring lead times of more than five days. LSMGO availability is better, with recommended lead times of 2-3 days.

Brent

The front-month ICE Brent contract has gained $3.89/bbl on the day, trading at $112.07/bbl at 08.00 CDT (13.00 GMT) today.

Upward pressure:

Brent futures have risen amid escalating tensions in the Middle East. Yemen-based Houthis struck several sites in Saudi Arabia on Wednesday, including King Fahd International Airport in Dammam, according to media reports. Saudi air defences intercepted a drone that was approaching a facility at Saudi Aramco’s Shaybah oilfield, Al Jazeera reported.

Following these attacks, the US administration has ordered some diplomats and their families to leave Saudi Arabia.

“Oil prices remain well bid, with ICE Brent back above $110/bbl this morning, following additional deadly attacks on Saudi Arabia,” analysts from ING Bank said.

Commercial US crude oil inventories fell by 3.1 million bbls to 412.5 million bbls in the week ending 16 October, according to data from the US Energy Information Administration (EIA). A decline in US crude stocks typically signals stronger demand and can offer some support to Brent’s price.

Downward pressure:

A sharp rise in Brent futures has been tempered by hopes of a breakthrough in US-Iran talks, aimed at resolving the Middle East conflict.

“Iran is prepared to give diplomacy another chance if we see strong evidence of a sincere desire by US to build trust & reach a just solution,” Iran’s foreign minister, Abbas Araghchi said on the social media platform X.

Additionally, the International Energy Agency (IEA) has expressed its willingness to release more oil from emergency stocks amid concerns over supplies from the Middle East.

By Gautamee Hazarika and Shilpa Sharma

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