East of Suez Market Update 17 Mar

Prices in East of Suez ports have dropped, and availability is tight across all grades in the UAE port of Fujairah.

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

• VLSFO prices down in Fujairah ($178/mt), Singapore ($97/mt) and Zhoushan ($31/mt)
• LSMGO prices down in Zhoushan ($127/mt), Singapore ($121/mt) and Fujairah ($95/mt)
• HSFO prices down in Zhoushan ($119/mt), Fujairah ($111/mt) and Singapore ($95/mt)

Fujairah’s VLSFO price has plunged by $178/mt in the past day, marking the steepest drop among the three major Asian bunker hubs. As a result, its previous premiums of $92/mt over Zhoushan and $36/mt over Singapore have reversed into discounts of $55/mt and $25/mt, respectively.

The port’s HSFO price has declined by $111/mt, though less steeply than VLSFO. Consequently, Fujairah’s Hi5 spread has narrowed by $67/mt to $203/mt, placing it below Singapore’s $283/mt and Zhoushan’s $247/mt.

Despite the volatility, bunkering operations continue at Fujairah, even after fires broke out following a drone strike on the Fujairah Oil Industries Zone on Monday morning, according to a source.

Oil loading operations were temporarily suspended after the attack, though some loadings resumed later on Monday, Reuters reported.

This marks the second major disruption at the key bunkering hub in recent days. Operations had only resumed on Sunday after being halted due to a separate drone strike over the weekend.

Authorities in Fujairah and Khor Fakkan have not issued formal alerts, but navigational warnings have been circulated following reports of intermittent GPS spoofing and signal jamming in offshore areas near Fujairah. These disruptions can result in inaccurate positioning, erratic vessel movements and misleading navigational data, prompting advice for mariners to treat the area as high risk, according to Inchcape Shipping.

Availability remains tight across all fuel grades in Fujairah, with offers subject to firm enquiry, a trader said.

“Bunkering is taking place, but some suppliers [are] waiting to load.” Some “terminals have opened up,” while suppliers are working through backlogs, the trader added.

Brent

The front-month ICE Brent contract has declined by $1.14/bbl on the day, to trade at $104.13/bbl at 17.00 SGT (09.00 GMT) today.

Upward pressure:

Brent crude has traded above $100/bbl so far this week, as the conflict in the Middle East has shown no signs of easing in its third week.

Last week, Iran said the world should brace for oil at $200/bbl as its forces continue to target commercial vessels transiting the Strait of Hormuz, Reuters reported.

“There have been no signs of de-escalation,” ANZ Bank’s senior commodity strategist Daniel Hynes said.

Meanwhile, US forces have hit Iranian military bases on the strategic Kharg Island. US President Donald Trump warned that Washington could target Tehran’s key oil infrastructure on the island if the Strait of Hormuz remains closed.

“Oil prices spiked… as the US attacked Iran’s oil export lifeblood, Kharg Island,” Price Futures Group’s senior market analyst Phil Flynn said.

Downward pressure:

The International Energy Agency (IEA) has announced a major release of 400 million bbls from strategic reserves to ease the price shock that is currently rattling the global oil market. The news has put some downward pressure on Brent’s price.

The IEA’s pledge marks the “biggest emergency drawdown in IEA history – aimed at cooling off the red-hot crude market amid the ongoing chaos in the Middle East with Iran,” Flynn said.

Member countries in the Americas have committed 195.8 million bbls. Asia and Oceania members have pledged 108.6 million bbls, while Europe has committed 107.5 million bbls, the IEA said.

“The US is ponying up 172 million barrels, Japan chipping in 80 million, and EU heavyweights such as Germany and Austria pledging their shares,” Flynn added.

By Tuhin Roy and Aparupa Mazumder

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