East of Suez Market Update 11 Nov

Most prices in East of Suez ports have moved higher, and availability of all grades is tight in Fujairah.

IMAGE: Bunker barge at berth in Fujairah, UAE. Port of Fujairah

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

• VLSFO prices up in Fujairah ($14/mt), Zhoushan ($7/mt) and Singapore ($1/mt)
• LSMGO prices up in Fujairah ($59/mt), Zhoushan ($55/mt), and down in Singapore ($3/mt)
• HSFO prices up in Zhoushan ($23/mt), Fujairah ($13/mt), and down in Singapore ($12/mt)

Fujairah’s VLSFO price has climbed by $14/mt, the steepest increase among the three major East of Suez bunker ports. The price now stands at a $5/mt discount to Singapore and a $17/mt discount to Zhoushan.

Fujairah’s LSMGO price has jumped by $59/mt over the past day. Its premium over Singapore’s LSMGO has shot up by $62/mt to $407/mt, and the premium over Zhoushan has edged up by $4/mt to $310/mt.

Fujairah’s LSMGO benchmark also holds a premium over some other major East of Suez ports.

The premiums have widened by $10/mt to $251/mt over Port Klang and by $9/mt to $350/mt over Busan, but narrowed by $1/mt to $355/mt over Hong Kong.

Supply in Fujairah is tight across all three grades, for prompt dates and further out.

Brent

The front-month ICE Brent contract has increased by $0.96/bbl on the day, to trade at $91.55/bbl at 17.00 SGT (09.00 GMT) today.

Upward pressure:

Brent futures have rebounded, following a report of a fresh attack on a tanker near the Strait of Hormuz. The United Kingdom Maritime Trade Operations (UKMTO) agency reported on Tuesday that a vessel was struck by an unknown projectile, approximately 19 nautical miles (NM) northeast of Lima, Oman.

The agency has advised vessels to transit with caution.

Iran's Revolutionary Guards Navy said, on Tuesday, that two tankers caught fire after striking naval mines while transiting the Strait of Hormuz, Reuters reported.

Additionally, Iran has denied US claims that negotiations on reopening the Strait of Hormuz are continuing. Iran’s Security Council chief Mohsen Rezaei said, “The US' claim about continuing negotiations or holding a meeting in Qatar is a pure lie,” state-owned news agency IRNA reported.

Downward pressure:

US crude oil inventories increased by 9 million bbls in the week ending 6 November, according to estimates from the American Petroleum Institute (API), as cited by Trading Economics.

A rise in US crude stocks usually indicates lower demand and can put downward pressure on Brent’s price. The market is now awaiting official inventory data from the US Energy Information Administration (EIA), which is due to be released later today.

Senior officials from Russia and Ukraine met in Abu Dhabi on Tuesday for US-brokered peace talks, marking their first such meeting since February, Reuters reported.

By Konica Bhatt and Shilpa Sharma

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