Americas Market Update 27 July

Bunker fuel prices across the Americas have moved in mixed directions, and fuel availability has improved in Los Angeles.

IMAGE: Cranes loading shipping containers along the waterfront at Long Beach port. Getty Images

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

• VLSFO prices up in Balboa ($24/mt), unchanged in Houston, and down in Zona Comun ($82/mt), New York ($53/mt) and Los Angeles ($4/mt)
• LSMGO prices up in Los Angeles ($14/mt) and Balboa ($2/mt), and down in Zona Comun ($131/mt), New York ($114/mt) and Houston ($112/mt)
• HSFO prices up in Los Angeles ($29/mt) and New York ($4/mt), and down in Houston ($10/mt) and Balboa ($1/mt)

Amongst the key Americas ports, Los Angeles' HSFO price has recorded the steepest increase while its VLSFO price has recorded the smallest decline over the past session. These price movements have resulted in the port's Hi5 spread narrowing to $78/mt today from $111/mt on Friday.

Availability of all three fuel grades at the port has improved slightly this week, a trader tells ENGINE.

Going against Brent's movement and the general market trend, Balboa's VLSFO price has increased over the past session. A 500-1,500 mt VLSFO stem, fixed at $726/mt, has offered upward support to the benchmark.

Lead times of 3-7 days are recommended for VLSFO and LSMGO at the Panamanian port. HSFO is typically delivered in around seven days, a source said.

Brent

The front-month ICE Brent contract has lost $6.52/bbl on the day from Friday, to trade at $90.87/bbl at 08.00 CDT (13.00 GMT) today.

Upward pressure:

Brent crude’s price is trading close to $90/bbl as market participants continue to monitor the situation in the Middle East.

Over the weekend, the US Central Command (CENTCOM) disabled another vessel in the Gulf of Oman, after its crew allegedly attempted to violate the blockade, it said.

The Mozambique-flagged M/T Lavine is no longer transiting to Iran after being disabled by US forces. The action marks the second commercial ship disabled by the US CENTCOM in recent weeks.

Downward pressure:

Brent’s price has plummeted from the previous week’s highs after Washington paused strikes on Iranian targets, raising hopes of a truce between the two countries.

“Oil prices fell sharply… as the US and Iran refrained from further military action, offering the first tangible signs of a potential de-escalation in tensions,” two analysts from ING Bank noted.

Oil market participants are seeing the weekend’s de-escalation as a temporary move, after the US struck Iran for 13 consecutive days.

The decline in Brent’s price reflects the oil market's “desperation for positive news,” ING Bank’s analysts said.

The pause is expected to give “diplomacy some space”, US Ambassador to the United Nations Mike Waltz said in an interview with CBS News, adding that military assets were still deployed in the region, should diplomacy fail.

By Gautamee Hazarika and Aparupa Mazumder

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