Bunker prices have moved in mixed directions in East of Suez ports in the past day, and supplies are tight in major bunkering hubs.
Changes on the day to 16.00 SGT (08.00 GMT) today:
- VLSFO price up in Fujairah ($2/mt), and down in Zhoushan and Fujairah ($9/mt)
- LSMGO prices down in Zhoushan ($20/mt), Singapore ($9/mt) and Fujairah ($4/mt)
- HSFO380 prices up in Fujairah ($7/mt) and Singapore ($1/mt)
VLSFO supply remains tight in Singapore, with lead times stretching to 11 days and prompt dates being even tighter. Terminal congestion continues to be an issue in the bunkering hub, with delayed loadings after a Covid-19 outbreak last week.
Fujairah’s VLSFO price has inched up on the day, lifted by a higher-priced stem, despite Brent’s downward pull. Availability is tight for all three bunker fuel grades in the port.
HSFO380 supply has become more difficult in Zhoushan this week, with only one supplier able to offer the fuel grade. Earliest replenishment is expected for early November, sources say.
Brent
Front-month ICE Brent crude has shed $0.50/bbl in the past day, to $85.67/bbl at 16.00 SGT (08.00 GMT).
Global oil supplies remain under pressure and the futures contract rallied to seven-week intraday highs yesterday. Forecasts of a colder-than-usual November in is expected to trigger power plants to pull more heating oil and other oil derivatives as feedstock.
“A colder November has energy traders bracing for a very tight market that will be met unprecedented demand this winter,” OANDA analyst Ed Moya said.
OPEC+ supply restraint is expected to keep the market firmly in a deficit over the winter and well into the first half of next year, Moya added.
Brent’s rally has run out of steam today amid weaker Chinese demand prospects. The Chinese government has intervened to keep a lid on surging coal and natural gas prices. If prices are reigned in, it could limit power plants from further switching to oil-based fuels.
Global gas-to-oil switching could boost oil demand by 1 million b/d, Goldman Sachs estimates according to Reuters. The bank now forecasts Brent could climb to $90/bbl by the end of the year.