East of Suez Market Update 30 Apr

Bunker fuel prices across all grades in East of Suez ports have tacked Brent’s upward move, and availability across all grades is tight in Saudi Arabia’s Jeddah port.

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 Fujairah ($43/mt), Singapore ($38/mt) and Zhoushan ($34/mt)
• LSMGO prices up in Fujairah ($81/mt), Zhoushan ($61/mt) and Singapore ($30/mt)
• HSFO prices up in Fujairah ($36/mt), Zhoushan ($35/mt) and Singapore ($34/mt)
• B30-VLSFO prices up in Singapore ($63/mt)

Fujairah’s VLSFO benchmark has recorded the sharpest jump among Asia’s key bunker hubs. This surge has placed Fujairah’s VLSFO price at premiums of $89/mt and $79/mt over Singapore and Zhoushan respectively.

Bunker supply in Fujairah remains tight as of now with all offers subject to firm inquiry, a trader said. While some suppliers still hold stocks, others are running close to empty “as no imports coming in at the moment,” the trader added.

Across the UAE, operations at Jebel Ali, Hamriyah and Sharjah are continuing as usual. Bunker availability in Saudi Arabia’s Jeddah port also remains tight, particularly for VLSFO and LSMGO.

VLSFO and LSMGO supply is also tight in Qatar’s Ras Laffan port.

Brent

The front-month ICE Brent contract has moved $6.22/bbl higher on the day, to trade at $120.92/bbl, at 17.00 SGT (09.00 GMT) today.

Upward pressure:

Brent crude’s price has traded above $120/bbl amid faltering hopes of a US-Iran resolution anytime soon.

Market analysts have lost hope of any quick resumption in oil flows through the Strait of Hormuz and the Persian Gulf, according to two analysts from ING Bank.

“The oil market has moved from over-optimism to the reality of the supply disruption we are seeing in the Persian Gulf,” the analysts said.

Brent’s price has felt further upward pressure after US Energy Information Administration (EIA) reported a sizeable decline in crude stocks.

Commercial US crude oil inventories decreased by 6.2 million bbls to about 459.5 million bbls in the week ending 24 April, according to data from the EIA.

A decline in US crude stocks typically indicates improvement in demand for oil and can put some upward pressure on Brent's price.

The EIA data “continues to show buyers turning to the US for alternative supplies amid the ongoing Persian Gulf disruptions,” ING Bank’s analysts added.

Downward pressure:

While there were no significant downward pressures on Brent’s price today, market participants expect the UAE’s exit from OPEC and OPEC+ to put downward pressure on oil prices in the long term.

The UAE will exit the Saudi Arabia-led coalition from 1 May, the country's energy minister Suhail Al Mazrouei said.

The UAE’s national oil company, Abu Dhabi National Oil Company (ADNOC) has set a target to raise crude oil production capacity to 5 million b/d by 2027.

Abu Dhabi’s output is currently capped at 3.41 million b/d under the OPEC+ quota system.

By Aparupa Mazumder

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