Prices in East of Suez ports have decreased, and LSMGO supply remains good across several Omani ports.

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

• VLSFO prices down in Zhoushan ($13/mt), Fujairah ($4/mt) and Singapore ($2/mt)
• LSMGO prices down in Zhoushan ($18/mt), Fujairah ($9/mt) and Singapore ($4/mt)
• HSFO prices down in Zhoushan ($12/mt), Fujairah ($6/mt) and Singapore ($5/mt)

Zhoushan’s LSMGO price has dropped by $18/mt over the past day, marking the steepest decline among the three major Asian bunker ports. Two lower-priced LSMGO stems, fixed in a wide range of $15/mt in Zhoushan, have contributed to the benchmark's fall. Currently, Zhoushan’s LSMGO price is at a discount of $65/mt to Fujairah and at a slight premium of $11/mt over Singapore.

In Zhoushan, lead times for LSMGO have increased slightly from 2-4 days last week, to 4-6 days now. VLSFO availability remains strong with lead times of 4-6 days, while HSFO lead times have improved to 3-5 days from 4-6 days last week.

In Fujairah, prompt availability remains tight, with lead times for all grades steady at 5-7 days, consistent with last week. Khor Fakkan has similar lead time recommendations for all grades.

Omani ports, including Sohar, Salalah, Muscat and Duqm, have ample LSMGO supply.

Brent

The front-month ICE Brent contract has inched $0.47/bbl lower on the day, to trade at $73.41/bbl at 17.00 SGT (09.00 GMT).

Upward pressure:

Market optimism over economic stimulus efforts to drive China’s recovery has lent support to the price of Brent crude. Chinese authorities plan to issue 3 trillion yuan ($411 billion) in special treasury bonds next year to revive the economy, Reuters reported, citing sources.

“Oil is getting a boost from talk of a massive amount of economic stimulus from China,” noted Phil Flynn, senior market analyst at Price Futures Group.

The World Bank has revised its forecasts for China's economic growth in 2024 and 2025, Reuters reported. This economic growth could increase demand for oil and drive up Brent prices.

In the US, crude oil inventories dropped by 3.20 million bbls in the week ending December 27, following a larger decrease of 4.70 million bbls the previous week, according to American Petroleum Institute (API) estimates. A decline in US crude oil inventories indicates rising oil demand, which could support Brent prices.

“The American Petroleum Institute’s slightly bullish US oil stocks data may have spurred the buying interest through Thursday,” said Vandana Hari, founder and analyst at VANDA Insights.

The US Energy Information Administration (EIA) is expected to release its closely watched crude oil stockpile report later today.

Downward pressure:

A stronger US dollar pressured oil prices, limiting some of its gains.

The dollar has climbed approximately 7% this quarter and remains near a two-year high against major currencies after the Federal Reserve indicated slower rate cuts in 2025, according to Reuters.

A stronger dollar increases the cost of oil for buyers using other currencies. This can reduce oil demand and put downward pressure on prices.

By Tuhin Roy

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