East of Suez Market Update 4 Dec

Most prices in East of Suez ports have remained broadly steady, and availability of all grades is good in Zhoushan.

IMAGE: Yangshan harbour of Shanghai, China. Getty Images

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

• VLSFO prices up in Fujairah ($2/mt), unchanged in Singapore, and down in Zhoushan ($3/mt)
• LSMGO prices up in Fujairah ($12/mt) and Zhoushan ($1/mt), and down in Singapore ($1/mt)
• HSFO prices down in Zhoushan ($3/mt), Singapore and Fujairah ($1/mt)
• B30-VLSFO at a $243/mt premium over VLSFO in Singapore
• B30-VLSFO at a $260/mt premium over VLSFO in Singapore

VLSFO prices across the three major Asian bunker hubs have stayed largely rangebound over the past day, with no significant moves. In Zhoushan, VLSFO is priced at a premium of $10/mt to Fujairah and $8/mt to Singapore.

Demand in Zhoushan remains muted, and suppliers are advising lead times of 4–7 days for all grades, slightly shorter than the roughly seven days recommended last week.

Fuel availability in northern China continues to be uneven: Dalian and Qingdao have sufficient VLSFO and LSMGO, though HSFO is still tight in Qingdao. Shanghai continues to see limited VLSFO and HSFO supply, while LSMGO availability is steady.

Further south, Fuzhou is short on both VLSFO and LSMGO, and delivery options for both fuels remain tight in Yangpu and Guangzhou.

Brent

The front-month ICE Brent contract has risen by $0.18/bbl on the day, to trade at $63.02/bbl at 17.00 SGT (09.00 GMT) today.

Upward pressure:

Oil prices rose after Ukrainian strikes on Russia’s oil infrastructure raised concerns about supply disruptions and as stalled peace talks dampened hopes of a deal that could bring more Russian crude back to global markets.

Ukraine targeted the Druzhba pipeline in Russia’s Tambov region—its fifth strike on the route supplying Hungary and Slovakia—according to a Ukrainian military intelligence source cited by Reuters.

Prices were also supported by the sense that peace negotiations were going nowhere. US President Donald Trump’s team left discussions with the Kremlin without progress on ending the war, and Trump told reporters it remained uncertain what happens now, Reuters reported.

“Crude oil gained as talks between Russia and Ukraine fail to deliver a peace deal,” said ANZ Bank senior commodity strategist Daniel Hynes.

Brent futures slipped, as “US-led Ukraine peace efforts drag on and the market lacks a clear signal on how or when they might conclude,” noted Vanda Insights’ founder Vandana Hari.

Downward pressure:

Brent crude has come under slight downward pressure after the latest weekly report from the US Energy Information Administration (EIA).

The EIA said commercial US crude inventories rose by 574,000 bbls to 428 million bbls for the week ending 28 November. An increase of this kind usually signals softer demand, which can weigh on Brent prices.

By Tuhin Roy

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