Bunker benchmarks across key Americas have largely tracked Brent’s upward movement, and a cold front is expected to pass through the US Gulf Coast this week.

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

• VLSFO prices up in Houston, New York and Balboa ($3/mt), and down in Los Angeles ($5/mt)
• LSMGO prices up in Balboa ($9/mt), New York ($3/mt) and Los Angeles ($2/mt), and unchanged in Houston
• HSFO prices up in New York ($6/mt) and Houston ($3/mt), and down in Balboa and Los Angeles ($1/mt)

New York’s LSMGO price has gained in the past day, while Houston's has been broadly steady. These diverging price movements have flipped New York’s LSMGO price from a discount to Houston, to a $21/mt premium now.

Suppliers in New York can offer VLSFO and LSMGO for prompt deliveries, a source says. HSFO is a bit tight and required longer lead times. Bunker operations may face some delays until 7 February due to rough weather conditions, a source said.

A thick layer of sea fog has reduced visibility and disrupted bunker operations around US Gulf Coast ports. The Houston Pilot Association has suspended outbound sailings through the Houston Ship Channel at the moment due to dense fog, with visibilities less than 1 nautical mile, another source said.

Bunker deliveries in the Galveston Offshore Lightering Area (GOLA) are currently underway, although delays are expected at the anchorage later this week due to rough weather conditions.

Brent

The front-month ICE Brent contract has gained $0.09/bbl on the day, to trade at $75.25/bbl at 07.00 CST (13.00 GMT).

Upward pressure:

Crude oil prices moved higher after US President Donald Trump signed a directive to increase pressure on Iranian crude flows, by enforcing stricter sanctions with an aim to drive Tehran’s oil exports to zero.

“As pledged during his campaign, Trump has issued a directive that aims to ramp up economic pressure on Iran,” ANZ Bank senior commodity strategist Daniel Hynes remarked.

This development is hardly unexpected, considering that during Trump’s previous term he had adopted a hardline stance on Iran and reinstated oil sanctions at the time, according to market analysts.

The stricter enforcement of sanctions “could see as much as 1m b/d [1 million b/d] of supply at risk,” two analysts from ING Bank said.

Downward pressure:

Brent’s price felt some downward pressure from rising US crude inventories and a freshly brewing Sino-US tariff war.

The White House confirmed yesterday that a 10% tariff would be applied to all imports from China. This news was immediately followed by China imposing a retaliatory tariff of 10% on US oil imports.

“The trade dispute between the US and China has raised demand concerns - not least in China, an economy that has grown increasingly dependent on exports at a time of weak consumer confidence at home,” Saxo Bank’s head of commodity strategy Ole Hansen remarked.

Oil demand growth concerns got another hit after the American Petroleum Institute (API) reported a big spike in US crude stocks. Crude oil inventories in the US increased by 5.02 million bbls in the week that ended 31 January, according to the API.

A surge in US crude stocks can indicate a drop in oil demand, which can cap Brent's price rise.

By Aparupa Mazumder

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