Fuel prices have moved down in the Americas, and bunker operations in Zona Comun remain suspended due to rough sea conditions.

IMAGE: A group of tankers in port along the Houston Ship Channel, Texas. Getty Images

Changes on the day from Friday to 08.00 CDT (13.00 GMT) today:

• VLSFO prices down in New York ($37/mt), Houston ($20/mt), Zona Comun ($12/mt), Los Angeles ($10/mt) and Balboa ($6/mt)
• LSMGO prices down in New York ($49/mt), Houston ($24/mt), Balboa ($15/mt) and Los Angeles ($9/mt)
• HSFO prices down in New York ($27/mt), Houston ($24/mt), Balboa ($20/mt) and Los Angeles ($6/mt)

New York has had the steepest price drops across all fuel grades. The port's VLSFO has dropped more sharply than its HSFO price, bringing the port's Hi5 spread down to $47/mt.

Bunker demand remains good in New York. All fuel grades are available for prompt delivery, with suppliers recommending lead times of around five days.

The hurricane season is currently underway, and a broad area of low pressure continues to generate disorganised showers and thunderstorms over and off the coast of Central America.

Heavy rainfall is expected across parts of Central America and southeastern Mexico over the next few days, which could impact bunker operations at key ports such as Guatemala's Puerto Quetzal, El Salvador's Acajutla, and Mexico's Puerto Chiapas and Salina Cruz, a source said.

Balboa's VLSFO price has decreased after a lower-priced 50–150 mt VLSFO stem was fixed at $529/mt, putting downward pressure on the benchmark.

The port's LSMGO price has also decreased after a lower-priced 150–500 mt LSMGO stem was fixed at $718/mt.

Bunker operations in Argentina's Zona Comun have been suspended due to winds exceeding 20 knots, according to the local authority. Additional disruptions are likely to persist through the end of the day on Monday.

Brent

The front-month ICE Brent contract has lost $1.67/bbl on the day from Friday, to trade at $73.19/bbl at 08.00 CDT (13.00 GMT).

Upward pressure:

Brent crude’s price has gained some upward momentum over the weekend as the simmering conflict between Israel and Iran quickly escalated, with the former targeting Tehran’s oil and gas facilities.

Over the weekend, Israel struck two key energy facilities near Tehran – Shahran fuel depot and the Shahr Rey oil refinery. The strikes have caused a series of explosions, according to media reports. Both the facilities were among the largest oil infrastructure sites in Iran.

“This marks a dramatic escalation in the conflict that has hung over the oil market since Hamas attacked Israel about 20 months ago,” ANZ Bank’s senior commodity strategist Daniel Hynes remarked.

Iran also retaliated with a barrage of drones and missiles towards multiple Israeli cities including the Haifa oil refinery in northern Israel. “The risk that this conflict will impact flows of crude oil rose significantly over the weekend,” Hynes added.

Downward pressure:

Additional supply from OPEC+ producers such as Saudi Arabia and the UAE could help cushion the market against short-term supply disruptions, according to market analysts.

“OPEC sits on 5m b/d [5 million b/d] of spare production capacity, and so any supply disruptions could prompt OPEC to bring this supply back onto the market quicker than expected,” two analysts from ING Bank noted.

Earlier in June, the oil producers’ alliance agreed to raise output by 411,000 b/d for July, maintaining the same monthly increase it has implemented consistently for the past three months.

Market watchers will closely review the upcoming OPEC oil market report, due later today, for fresh insights into the group’s supply and demand outlook.

By Gautamee Hazarika and Aparupa Mazumder

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