Most prices in East of Suez ports have moved up, and availability across all grades is good in Zhoushan.

IMAGE: Yangshan harbour of Shanghai, China. Getty Images

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

• VLSFO prices up in Singapore ($3/mt) and Zhoushan ($1/mt), and down in Fujairah ($1/mt)
• LSMGO prices up in Zhoushan ($12/mt), Singapore and Fujairah ($11/mt)
• HSFO prices up in Zhoushan ($8/mt), Singapore ($7/mt) and Fujairah ($6/mt)
• B24-VLSFO at a $249/mt premium over VLSFO in Singapore
• B24-VLSFO at a $256/mt premium over VLSFO in Fujairah

VLSFO benchmarks across the three major Asian bunker ports have remained broadly steady over the past day, with no major deviations. Zhoushan’s VLSFO premiums over Singapore and Fujairah stand at $25/mt and $24/mt, respectively.

HSFO prices in the three ports have also risen within a narrow range of $6–8/mt, with Zhoushan seeing the steepest increase. Zhoushan’s HSFO price remains at significant premiums of $44/mt and $23/mt over Fujairah and Singapore, respectively.

Bunker demand in Zhoushan remains weak, with lead times unchanged at 4–7 days for VLSFO, HSFO, and LSMGO. Operations across China are expected to stay subdued during the Golden Week holidays (1–8 October), as most suppliers will only fulfill pre-booked stems. New bookings will not be accepted after 26 September, according to a source.

In north China, Dalian and Qingdao have ample VLSFO and LSMGO, though HSFO is tight in Qingdao. In Shanghai, VLSFO and HSFO supply is strained, while LSMGO remains more stable. Further south, Fuzhou faces constraints in VLSFO and LSMGO; Xiamen has sufficient VLSFO but limited LSMGO; and both grades have limited delivery options in Yangpu and Guangzhou.

Brent

The front-month ICE Brent contract has gained by $1.00/bbl on the day, to trade at $68.65/bbl at 17.00 SGT (09.00 GMT).

Upward pressure:

Two major oil ports on Russia’s Black Sea coast – Caspian Pipeline Consortium (CPC) terminal and the Sheskharis facility – have temporarily halted the loading of tankers, following warnings of drone attacks, Bloomberg reported.

The renewed attack warnings highlight the growing impact of Ukraine’s sustained strikes on Russia’s energy infrastructure and have put upward pressure on Brent’s price today.

It is estimated that both facilities export “well over” 2 million b/d of Russian and Kazakh oil to global markets, “holding a major share of the world’s petroleum supply chain,” said two analysts from ING Bank.

Brent gained further after the US Energy Information Administration (EIA) reported a 600,000-bbl draw in US crude stocks.

The data showed "a larger-than-expected drop in US crude oil inventories,” the two ING analysts said. A drop in US crude stocks typically indicates higher demand and can lend some support to Brent's price.

Downward pressure:

Oil market participants are somewhat concerned over supply fundamentals, as additional barrels from Iraq and Kurdistan are expected to enter circulation, adding downward pressure on Brent.

Crude oil flows from Iraqi Kurdistan are expected to resume soon, as eight oil firms struck a deal with Iraq's federal government and Kurdistan Regional Government yesterday, Reuters reported.

The announcement has “paved the way for resumption of Kurdish crude exports from Ceyhan within days,” remarked VANDA Insights’ founder Vandana Hari.

By Tuhin Roy and Aparupa Mazumder

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