Bunker benchmarks in key Americas ports have moved in mixed directions, and rough weather may delay some bunker deliveries in the Galveston Offshore Lightering Area (GOLA).

Changes on the day, to 07.00 CST (13.00 GMT) today:

• VLSFO prices up in Zona Comun ($13/mt), Los Angeles ($4/mt) and Balboa ($3/mt), unchanged in New York, and down in Houston ($1/mt)
• LSMGO prices up in Balboa ($14/mt), Houston ($10/mt), New York ($8/mt), and Los Angeles ($6/mt)
• HSFO prices up in Balboa ($6/mt) and Los Angeles ($3/mt), and down in Houston ($8/mt) and New York ($1/mt)

LSMGO prices in Houston and New York have tracked Brent’s upward movement and gained in the past day. Houston currently prices its LSMGO at a premium of $14/mt over New York.

Prompt availability remains tight across all grades in Houston, with recommended lead times of 7-9 days for VLSFO and LSMGO, and nine days for HSFO. High wind gusts forecast until 10 January could mean that bunker deliveries will remain suspended in Houston, a source said.

On the West Coast, prompt bunker availability has improved in Los Angeles and Long Beach in January, with suppliers recommending lead times of seven days for VLSFO and LSMGO.

Rough weather conditions could keep bunker deliveries suspended in the Galveston Offshore Lightering Area (GOLA) through this week. High wind gusts are expected to disrupt deliveries “over the next several days,” a source said.

Brent

The front-month ICE Brent contract has gained $0.74/bbl on the day, to trade at $77.39/bbl at 07.00 CST (13.00 GMT).

Upward pressure:

Brent’s price found a strong upward thrust from positive US data that have supported demand growth expectations in the oil market.

Crude oil inventories in the US dropped by 4.0 million bbls in the week that ended 3 January, according to the American Petroleum Institute (API) estimates. A drop in US crude stocks indicates a growth in oil demand, which can support Brent's price.

Oil gained more support due to fresh supply concerns in eastern Europe after a Ukrainian drone struck a Russian oil depot yesterday, Ukraine's military said on the Telegram messaging app.

While the market awaits a Russian retaliation, it is also preparing for stricter sanctions against Russian and Iranian oil firms, expected to come into action once President-elect Donald Trump takes his official oath at the White House later this month.

“Given that oil from Russia and Iran typically flows into the inventories of China's teapot refineries and other storage facilities, this [potential] reduction [of Russian and Iranian oil supply] is seen as a significant driver of the current tight supply dynamics in Asia,” SPI Asset Management’s managing partner Stephen Innes said.

Downward pressure:

President-elect Donald Trump is ready to reverse the latest presidential order banning the majority of the offshore oil and natural gas leases in the eastern Gulf of Mexico, the Pacific Ocean, as well as portions of the Northern Bering Sea in Alaska, several media reports suggested.

With just two weeks in office, the Biden administration’s ban on most new oil and gas drilling off the Pacific and Atlantic coasts aims at drastically reducing US oil and gas production.

However, global markets are already on track to brace the “drill, baby, drill” agenda in Trump’s second term as the US President.

“Throughout his 2024 presidential campaign, Trump vowed that, if elected, he would expand oil and gas drilling to bolster American-made energy,” Price Futures Group’s senior market analyst Phil Flynn said.

By Aparupa Mazumder

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