East of Suez Market Update 10 Dec

Most prices in East of Suez ports have moved down, and availability of all grades is good in Zhoushan.

IMAGE: Aerial view of the container terminal at the Port of Tianjin, China. Getty Images

Changes on the day to 17.00 SGT (09.00 GMT) today:

• VLSFO prices unchanged in Singapore, and down in Zhoushan ($12/mt) and Fujairah ($2/mt)
• LSMGO prices down in Fujairah ($7/mt), Singapore and Zhoushan ($3/mt)
• HSFO prices down in Fujairah ($8/mt), Singapore ($5/mt) and Zhoushan ($1/mt)
• B30-VLSFO at a $265/mt premium over VLSFO in Singapore
• B30-VLSFO at a $287/mt premium over VLSFO in Fujairah

Zhoushan’s VLSFO price has dropped by $12/mt in the past day, while prices in Singapore and Fujairah have stayed largely unchanged. Even after the decline, Zhoushan’s VLSFO commands premiums of $25/mt over Fujairah and $20/mt over Singapore.

Bunker demand in Zhoushan remains weak, with suppliers continuing to advise lead times of 4–7 days for all grades, the same as last week. Fuel availability across northern China is mixed: VLSFO and LSMGO supply is ample in Dalian and Qingdao, while HSFO remains tight in Qingdao. Bunker supply is still tight across all grades in Tianjin. Shanghai has limited VLSFO and HSFO, while LSMGO supply is steady.

Farther south, Fuzhou is short of both VLSFO and LSMGO stocks. Xiamen has sufficient VLSFO but restricted LSMGO supply. Delivery options for both grades remain limited in Yangpu and Guangzhou.

Brent

The front-month ICE Brent contract has moved $0.42/bbl lower on the day, to trade at $61.88/bbl at 17.00 SGT (09.00 GMT) today.

Upward pressure:

The American Petroleum Institute (API) has estimated a drop in US crude stocks, providing some upward support to Brent crude’s price.

US crude oil inventories decreased by 4.8 million bbls in the week ending 5 December, according to API estimates.

A drop in US crude stocks usually signals stronger demand and can offer some support to Brent’s price.

“American Petroleum Institute numbers yesterday were supportive for crude [prices],” two analysts from ING Bank noted.

Downward pressure:

Ongoing peace negotiations to end the war in Ukraine has dragged Brent’s price lower so far this week.

Ukrainian President Volodymyr Zelensky, along with other European partners will present "refined documents" on a ceasefire plan with Russia soon, Reuters reported.

Should Ukraine and Russia reach a peace agreement, global sanctions on Russian companies may be eased, allowing sanctioned oil volumes back into the market, market analysts project.

In other news, the US Energy Information Administration (EIA) has released its latest oil market outlook, estimating that US crude oil production will reach a record high of 13.61 million b/d in 2025.

“A bearish gloom has been developing over the [oil] market in recent months, not helped by a bearish report from the Energy Information Administration,” ANZ Bank’s senior commodity strategist Daniel Hynes said.

The EIA expects global liquid fuels output to rise by 3 million b/d in 2025, reaching 106.1 million b/d. Production is projected to increase by a further 1.3 million b/d in 2026, lifting total supply to 107.4 million b/d.

By Tuhin Roy and Aparupa Mazumder

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