Americas Market Update 8 May

Fuel prices have moved up, and bunker operations have been suspended in Zona Comun due to rough weather conditions.

IMAGE: Cargo containers being offloaded in the Port of Los Angeles. Getty Images

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

• VLSFO prices up in Houston ($59/mt), Los Angeles ($47/mt), Zona Comun ($39/mt), New York ($37/mt) and Balboa ($13/mt)
• LSMGO prices up in Los Angeles ($239/mt), Zona Comun ($109/mt), Houston ($69/mt), New York ($53/mt) and Balboa ($49/mt)
• HSFO prices up in Balboa ($37/mt), Los Angeles ($34/mt), New York ($30/mt) and Houston ($22/mt)

Los Angeles's LSMGO price benchmark has recorded the highest jump across all key ports and all three grades in the past day. A higher-priced 50–150 mt LSMGO stem booked at $1,630/mt has put upward pressure on the benchmark.

Availability of prompt supply is currently tight at the West Coast port, with recommended lead times of over a week, a source said.

Balboa’s VLSFO price benchmark has recorded the smallest uptick for the grade, while its HSFO price has posted the strongest gain for the grade.

These price movements have narrowed the port's Hi5 spread to $40/mt today, down from $64/mt yesterday.

Availability in the ports of Balboa and Cristóbal is normal for both VLSFO and LSMGO, with recommended lead times of 4–6 days. HSFO requires slightly longer lead times of 5–7 days.

In Argentina's Zona Comun, bunker operations are currently suspended due to high winds exceeding 20 knots. Prolonged delays are expected over the next several days, a trader said.

Brent

The front-month ICE Brent contract has gained $2.79/bbl on the day, to trade at $100.38/bbl at 08.00 CDT (13.00 GMT) today.

Upward pressure:

Brent futures are poised to end the week above the $100/bbl mark amid growing tensions between the US and Iran.

Iran's military has accused Washington of violating the ceasefire agreement by targeting two Iran-linked vessels in the Strait, as well as civilian areas yesterday.

“Oil prices are likely to remain highly headline‑driven, with the recent escalation reinforcing the risk premium,” two analysts from ING Bank noted.

Meanwhile, the US Central Command (CENTCOM) said it intercepted Iranian missiles and responded with “self-defense” strikes as the US Navy’s guided-missile destroyers transited the Strait of Hormuz.

“With flows through the Strait of Hormuz unlikely to normalise quickly, markets remain exposed to further upside on any setbacks in diplomatic efforts,” ING Bank’s analysts said.

Downward pressure:

Brent’s price gains were capped by hopes of a ceasefire deal between Washington and Tehran that could eventually reopen the strategically crucial Strait of Hormuz to commercial vessel traffic.

Iran is considering a new one-page US proposal to end the conflict in the Middle East, the BBC reported earlier, prompting a steep sell-off in Brent’s price earlier this week.

“While tensions have escalated [today], the US has signalled no immediate intent to intensify the conflict and is reportedly still awaiting Iran’s response to a proposal to reopen the trade route,” ING Bank’s analysts noted.

By Gautamee Hazarika and Aparupa Mazumder

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