Fuel prices have largely declined, and there is a 90% chance of cyclone formation in the Atlantic within the next seven days.

IMAGE: Containers stacked on a freight ship in a port in Argentina. Getty Images

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

• VLSFO prices up in Balboa, Zona Comun ($2/mt), and down in Houston ($11/mt) and New York ($4/mt)
• LSMGO prices up in Zona Comun ($20/mt), New York ($4/mt), Houston ($1/mt), and down in Balboa ($19/mt)
• HSFO prices down in New York ($6/mt), Balboa ($4/mt) and Houston ($2/mt)

Barring Balboa's LSMGO price that has dipped sharply by $19/mt, all other key ports have recorded gains in prices for the grade.

Balboa's LSMGO price drop occurred after a lower-priced 150-500 mt LSMGO stem was fixed at $724/mt today at the port, which put downward pressure on the benchmark.

LSMGO is available in both Balboa and Cristobal within recommended lead times of 4–5 days.

Meanwhile, Zona Comun's LSMGO price has recorded the highest gain in the past session, and weather conditions at the anchorage remain conducive for bunkering.

Fuel availability remains healthy in New York, with suppliers advising 3–5 days of lead time across all three grades. The port's HSFO price declined by $6/mt and is currently at a premium of $22/mt to Houston, down from the $32/mt premium it held a month ago.

In the Atlantic region, amid the ongoing hurricane season, a low-pressure system has become more organized and has a 90% chance of developing into a cyclone within the next seven days.

Brent

The front-month ICE Brent contract has gained $0.96/bbl, to trade at $68.12/bbl at 08.00 CDT (13.00 GMT).

Upward pressure:

Brent crude’s price has gained some upward momentum as traders factor in production risks to Russian energy supplies, with Ukrainian drone strikes on its oil infrastructure continuing to intensify.

Yesterday, Kyiv struck the Kirishi oil refinery, one of Russia’s largest oil refining facilities, Reuters reported. The facility has halted a major processing unit following the attack, the report added.

The refinery has an “annual processing capacity of over 20mt [20 million mt],” according to ANZ Bank’s senior commodity strategist Daniel Hynes.

Last week, Ukraine struck one of Russia’s largest oil exporting terminals in Primorsk. The strikes coincide with reports that Washington and the EU are preparing tighter sanctions on Russia and on major buyers of its energy exports, particularly China and India.

“The market participants are waiting for any further developments regarding the potential of further Western sanctions on Russian supplies,” remarked two analysts from ING Bank.

Downward pressure:

Brent’s price has moved lower as market participants shift focus to the US Federal Reserve’s (Fed) meeting scheduled for today and tomorrow.

The meeting carries significant weight, with the US central bank expected to decide whether to maintain interest rates at current levels or implement a cut, according to market analysts.

Oil prices came under pressure last week after US inflation rate, based on Consumer Price Index (CPI) rose 2.9% year-on-year in August, up from 2.7% in July, dampening the likelihood of interest rate cuts.

Higher interest rates in the US can dampen demand growth and make dollar-denominated commodities like oil more expensive for holders of other currencies.

By Gautamee Hazarika and Aparupa Mazumder

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