East of Suez fuel prices are mostly down with Brent crude, and bunkering has resumed with calmer weather conditions in Shanghai.
Changes on the day to 16.00 SGT (08.00 GMT) today:
- VLSFO prices down in Zhoushan ($13/mt), Fujairah ($2/mt) and Singapore ($1/mt)
- LSMGO prices down in Zhoushan ($22/mt), Fujairah ($20/mt) and Singapore ($2/mt)
- HSFO380 prices up in Singapore ($2/mt), and down in Fujairah ($5/mt)
Bunkering has resumed in Shanghai, to allow suppliers work through backlogs after a storm halted bunker operations in ports along China’s eastern and northern coast from last Friday.
Zhoushan is still experiencing strong winds and bunkering remains suspended. After gale in Zhoushan yesterday, winds calmed some today, but more gale-force winds are forecast for tomorrow.
A 150-500 mt VLSFO stem was fixed in Shanghai today, weighing on its benchmark. VLSFO is still priced $30/mt higher in Shanghai than in Zhoushan, as Zhoushan’s price has fallen more steeply in the past day.
In Japan, bunker supply is tight at western ports since some refineries are under maintenance. The country’s is also drawing more fuel oil for heating purposes as winter has set in and gas prices have soared.
VLSFO and HSFO380 availability remains particularly tight in Singapore with lead times of up to 12-13 days. LSMGO is tight for prompt dates in Singapore, and can be procured with a shorter seven days of lead time.
In Fujairah, limited supply of HSFO380, VLSFO and LSMGO keeps recommended lead times at 6-7 days.
Hi5 spreads have come down by $3/mt to $157/mt in Singapore, while up by $3/mt to $122/mt in Fujairah.
Brent
After a sharp increase at the beginning of the week, front-month ICE Brent has inched down by $0.13/bbl in the past day, to $83.49/bbl at 16.00 SGT (08.00 GMT).
Brent hovers around weekly highs, buoyed by prospects of stronger US fuel demand. A $1 trillion US infrastructure bill passed through both chambers of Congress last week and could boost future fuel demand. The country has also reopened for vaccinated international tourists after a Covid-19 halt, which could see jet fuel demand make a tentative comeback.
Keeping a lid on further price gains, the White House has said it is looking at “tools” to cool prices for domestic fuel consumers after OPEC+ stuck to its policy of limiting output increases to 400,000 b/d.
“President Biden said he wants to see more supply, with the administration looking at other tools such as tapping the strategic reserve,” ANZ commodity strategist Daniel Hynes said.