East of Suez Market Update 22 Apr
Prices in East of Suez ports have moved higher, and most offers in the UAE’s Fujairah port remain subject to enquiry.
IMAGE: Aerial view of Jebel Ali Port, Dubai. Getty Images
Changes on the day to 17.00 SGT (09.00 GMT) today:
- VLSFO prices up in Singapore, Fujairah ($31/mt) and Zhoushan ($28/mt)
- LSMGO prices up in Zhoushan ($56/mt), Singapore ($34/mt) and Fujairah ($9/mt)
- HSFO prices up in Zhoushan ($30/mt), Singapore ($25/mt) and Fujairah ($12/mt)
- B30-VLSFO prices up in Singapore ($40/mt)
VLSFO prices across East of Suez ports have increased by $28–31/mt over the past day. Fujairah’s VLSFO benchmark is currently at an $18/mt premium to Singapore and an $18/mt discount to Zhoushan.
In Fujairah, the rise in VLSFO price has outpaced the increase in its HSFO benchmark, pushing the port’s Hi5 spread up by $19/mt to $122/mt. This remains well above Zhoushan’s $72/mt and Singapore’s $50/mt.
“The bunkering situation in the Middle East is more stable now, but still not fully consistent,” a source said.
Bunkering operations in Fujairah continue without disruption, with terminals and anchorages functioning normally. “Avails [are] ok as of now, all offers are subject to firm inquiry,” another source noted.
Despite steady operations, some suppliers are loading barges in line with actual demand rather than at full capacity, indicating subdued bunker demand at the port.
Elsewhere in the UAE, operations at Jebel Ali, Hamriyah and Sharjah are proceeding as usual. Petroleum terminals in Abu Dhabi, including Ruwais, are also operating normally. Ship-to-ship (STS) operations at Dubai anchorage have resumed with tug assistance, with each case assessed individually, according to shipping agency Inchcape Shipping.
Brent
The front-month ICE Brent contract has gained $4.35/bbl on the day, to trade at $99.42/bbl at 17.00 SGT (09.00 GMT) today.
Upward pressure:
Brent’s price has shed the previous day’s losses amid escalating tensions in the Strait of Hormuz.
At least three container vessels in the region were hit by gunfire yesterday, the United Kingdom Maritime Trade Operations (UKMTO) reported.
The attacks come amid continued US blockade of the Strait - a move Tehran has labelled an act of war.
“UKMTO has received a report of an incident 8 NM [nautical miles] west of Iran. A master of an outbound cargo ship reports having been fired upon and is now stopped in the water,” the UKMTO reported.
Another containership sustained heavy damage to the bridge, after being hit by gunfire 15 NM northeast of Oman, the maritime intelligence agency reported.
The UKMTO said the Liberia-flagged vessel was approached by an Iranian gunboat and was subsequently fired upon.
“The longer these supply disruptions persist, the tighter the oil market becomes, leaving a longer path towards normalisation for markets once hostilities end,” two analysts from ING Bank said.
Prior to the outbreak of the conflict on 28 February, the waterway carried about 20% of global seaborne oil flows. “Energy flows will take time to recover,” ING Bank analysts added.
Downward pressure:
Brent’s price has felt some downward pressure amid some hopes of de-escalation in the Middle East conflict.
Yesterday, US President Donald Trump announced an indefinite extension of the ceasefire to allow further negotiations, as the Middle East conflict enters its second month.
A fresh round of talks between Washington and Tehran is planned for later today in Islamabad, according to media reports. Although, the latter’s willingness to participate in negotiations remains unclear.
“These talks are important, with the current ceasefire set to end on Wednesday,” ING Bank’s analysts said. “A lack of progress would likely push oil and gas prices higher,” they added.
By Tuhin Roy and Aparupa Mazumder
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