East of Suez Market Update 4 Nov

Most prices in East of Suez ports have moved lower, while VLSFO and HSFO availability is tight in Singapore.

IMAGE: Aerial view of Singapore container terminal. Getty Images

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

• VLSFO prices down in Singapore ($56/mt), Zhoushan ($33/mt) and Fujairah ($21/mt)
• LSMGO prices up in Zhoushan ($24/mt), and down in Fujairah ($32/mt) and Singapore ($1/mt)
• HSFO prices up in Zhoushan ($13/mt), and down in Singapore ($49/mt) and Fujairah ($13/mt)

Singapore’s VLSFO price has fallen by $56/mt, the steepest decline among the three major Asian bunker ports. The price now stands at a $56/mt discount to Fujairah and a $25/mt discount to Zhoushan.

Consequently, Singapore’s Hi5 spread has narrowed from $83/mt to $76/mt, below Fujairah’s $226/mt but above Zhoushan’s $62/mt.

Singapore’s VLSFO monthly average price has risen every month since June, from $725/mt in June to $926/mt in October, the highest since July 2022.

Availability remains tight in Singapore, where late cargo arrivals and congestion at loading terminals are still limiting supply, a source said. VLSFO lead times are currently 13-15 days. Suppliers were recommending lead times from around 13 days to more than three weeks last week. HSFO lead times have also settled at 13-15 days, after a similar range of around 13 days to as long as three weeks previously. LSMGO lead times have eased slightly to 8-10 days from 9-11 days last week.

Supply of several fuel grades is constrained at Port Klang in Malaysia. Prompt VLSFO availability is especially tight, LSMGO supplies remain limited and HSFO availability continues to face pressure.

Brent

The front-month ICE Brent contract has lost by $2.89/bbl on the day, to trade at $103.53/bbl at 17.00 SGT (09.00 GMT) today.

Upward pressure:

Brent crude’s price has found some support from an unexpected draw in US crude stocks and fresh clashes between the US and Iran.

US crude oil inventories fell by 5.3 million bbls in the week ending 30 October, according to estimates from the American Petroleum Institute (API).

A decline in US crude stocks usually signals stronger demand and can offer some support to Brent’s price.

Besides, Washington has attacked an Iranian anti-aircraft facility on Qeshm Island near the Strait of Hormuz, ANZ Bank’s senior commodity strategist Daniel Hynes said.

Effective throughput of oil through the Strait of Hormuz has fallen to 56% of pre-conflict levels “and is trending lower,” Hynes added.

Downward pressure:

Brent’s price has come under downward pressure amid signs that the US is not planning an imminent return to major combat with Iran.

US President Donald Trump told the Financial Times yesterday that Washington had no immediate plans to strike Iran.

This week’s strikes on Qeshm Island appeared limited and did not signal a return to major combat operations, Reuters reported, citing a US official.

Trump’s comments came as his Republican Party lost control of both houses of Congress in yesterday’s US midterm elections – a vote the global oil market had been watching closely, after the US President threatened to resume strikes on Iran once it was over.

By Tuhin Roy and Aparupa Mazumder

Please get in touch with comments or additional info to news@engine.online