Americas Market Update 28 Jan

Fuel prices have increased across all major ports in the Americas, and bunker deliveries in Freeport are expected to face delays due to strong wind gusts.

IMAGE: Tugs and cargo ships docked at Freeport, Bahamas. Getty Images.

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

• VLSFO prices up in Zona Comun ($22/mt), Balboa ($14/mt), Los Angeles, New York ($12/mt) and Houston ($4/mt)
• LSMGO prices up in Houston ($52/mt), New York ($47/mt), Zona Comun ($46/mt), Balboa ($30/mt) and Los Angeles ($13/mt)
• HSFO prices up New York ($21/mt), Balboa ($18/mt), Los Angeles and Houston ($10/mt)

Houston’s LSMGO price has recorded the strongest gains across all ports and grades, after a higher-priced 500–1500 mt stem, fixed at $723/mt, put upward pressure on the benchmark.

Advised lead times for all three grades at Houston is currently between 6–10 days.

New York’s HSFO price has posted the largest gain for the grade, while its VLSFO price has increased by a smaller margin, widening the port’s Hi5 spread to $108/mt today.

In New York, demand has remained static since last week. Extremely cold weather moving into the harbour is expected to weigh on HSFO supply over the coming week, a source said.

Lead times for HSFO stand at 6–7 days, while VLSFO and LSMGO are available for prompt delivery, with recommended lead times of 2–3 days.

In the Bahamas’ Freeport, possible disruptions are expected until 1 February due to high wind gusts, which could lead to delays in bunker deliveries, a trader told ENGINE.

Brent

The front-month ICE Brent contract has gained by $2.37/bbl on the day, to trade at $67.97/bbl at 07.00 CST (13.00 GMT) today.

Upward pressure:

US crude oil production and exports have been majorly disrupted this week due to harsh winter storms. This has supported Brent’s price.

US refiners have lost 2 million b/d, or about 15% of the country's total output over the weekend, Reuters reported.

“A winter storm in the US has disrupted refineries on the Gulf Coast and elsewhere,” ANZ Bank’s senior commodity strategist Daniel Hynes said.

Meanwhile, a weaker US dollar has lent further support. The dollar is trading close to a four-year low against major currencies, Reuters reported.

This slide is making dollar-priced commodities such as crude oil more affordable for holders of other currencies.

Downward pressure:

Brent crude has felt some downward pressure after Kazakhstan said that output at the Tengiz oilfield – one of the OPEC+ member’s largest crude oil production sites – will resume full production within a week, according to Reuters.

“Kazakhstan’s oil output is set to recover, with Tengizchevroil restoring power to its Tengiz field,” two analysts from ING Bank said.

Besides, Kazakhstan’s pipeline operator Caspian Pipeline Consortium (CPC) said it has restored full loading capacity at its Black Sea terminal after completing maintenance work at one of its three mooring points that was hit by Ukrainian drones.

By Gautamee Hazarika and Aparupa Mazumder

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