Americas Market Update 7 Jan

Fuel prices have declined across all major ports in the Americas, and cold weather in New York Harbor has delayed some bunker deliveries.

IMAGE: The Statue of Liberty seen from New York Harbor. Getty Images

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

• VLSFO prices down in New York ($16/mt), Los Angeles, Zona Comun ($15/mt), Houston ($13/mt) and Balboa ($8/mt)
• LSMGO prices down in Zona Comun ($37/mt), New York ($23/mt), Balboa ($18/mt), Houston ($15/mt) and Los Angeles ($14/mt)
• HSFO prices down in New York ($13/mt), Los Angeles, Houston ($8/mt) and Balboa ($5/mt)

Fuel prices have largely tracked Brent’s downward movement over the past day.

Zona Comun’s LSMGO price has declined the most across all key ports and all three conventional grades. It continues to be at premiums over LSMGO prices in other Argentinian ports, including $35/mt over Buenos Aires and $43/mt over Bahia Blanca.

Delivery delays at Zona Comun are expected to be severe this week. From 15.00 local time on Wednesday, operations are expected to be halted at the anchorage due to high wind gusts.

Bunkering could be suspended for a prolonged period at the anchorage, possibly until 11 January, a trader told ENGINE.

New York’s VLSFO and HSFO prices have declined by the highest margin compared with other ports. The port’s VLSFO price has fallen more sharply over the past day, widening its Hi5 spread to $105/mt today.

Currently, exceptionally cold weather in the New York Harbor has been causing some supply delays this week, but temperatures are expected to rise soon, which should ease conditions, a ship agent said.

Brent

The front-month ICE Brent contract has lost $1.28/bbl on the day to trade at $60.73/bbl at 07.00 CST (13.00 GMT) today.

Upward pressure:

Brent’s price has felt some upward thrust after the American Petroleum Institute (API) reported a drop in US crude stocks.

US crude oil inventories decreased by 2.8 million bbls in the week ending 2 January, according to API estimates cited by Trading Economics.

A slump in US crude stocks usually signals good demand and can give some support to Brent’s price.

Downward pressure:

Brent crude’s price has plunged after the market quickly assessed the fallout from Venezuela’s political turmoil and the uncertainty surrounding control of its oil assets.

Yesterday, US President Donald Trump said Venezuela’s interim administration would be “turning over” 30-50 million bbls of sanctioned oil to be sold at market prices.

The development comes after last week’s detention of President Nicolas Maduro and his wife from the country’s capital city Caracas.

The end of Maduro presidency in Venezuela could add fresh barrels to an already oversupplied market, according to analysts.

By Gautamee Hazarika and Aparupa Mazumder

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