Bunker fuel prices have mostly risen, while Houston has seen a drop in VLSFO demand.

IMAGE: Heavy industrial rigs at a shipyard near Houston, Texas. Getty Images

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

• VLSFO prices up in Los Angeles ($26/mt), Houston ($25/mt), Zona Comun ($23/mt), Balboa ($10/mt) and New York ($6/mt)
• LSMGO prices up in Houston ($34/mt), Balboa ($32/mt), New York ($13/mt) and Los Angeles ($2/mt), and down in Zona Comun ($50/mt)
• HSFO prices up in New York ($7/mt), Houston ($5/mt), Balboa ($3/mt) and Los Angeles ($2/mt)

Bunker prices in major Americas locations have tracked Brent's upward movement, except for Zona Comun's LSMGO price benchmark which has plunged $50/mt lower.

VLSFO and LSMGO grades are readily available in Zona Comun and can be delivered by the 4–5 barges currently in operation. Suppliers are recommending lead times of 5–6 days this week.

Weather conditions at the anchorage location are currently normal but are expected to deteriorate from tomorrow morning, with high winds of 22–25 knots and elevated seas forecast. This could make bunkering unfeasible at the anchorage.

Houston's VLSFO price has increased by $25/mt, while the port's HSFO price has risen by $5/mt, resulting in a Hi5 spread of $32/mt today, a recovery from yesterday's slim $12/mt.

A source informed ENGINE that demand for all three conventional fuel grades has weakened in Houston, with VLSFO premiums notably declining amid softer demand.

In terms of weather conditions, cooler air has moved into the Houston area, bringing increased winds offshore and around Bolivar Roads, though no extreme conditions or significant delays are expected through 26 October.

Los Angeles' VLSFO price has recorded the highest gain among major ports in the past day. It is currently at premiums of $100/mt over Houston and $58/mt over New York.

Bunker demand remains steady in the West Coast port, with LSMGO and VLSFO available for prompt deliveries within 3–5 days.

Brent

The front-month ICE Brent contract has moved $3.46/bbl higher on the day, to $65.80/bbl at 08.00 CDT (13.00 GMT) today.

Upward pressure:

Brent crude’s price has moved higher amid escalating tensions between the West and Russia.

The US Treasury Department has sanctioned two of Russia’s biggest oil companies – Rosneft and Lukoil.

Rosneft and Lukoil “produce more than 5m b/d [5 million b/d] of oil,” remarked ING Bank’s head of commodities strategy Warren Patterson. “Clearly, the concern for the market is oil flows from Russia,” he said.

Meanwhile, the European Union has adopted the 19th package of economic sanctions against Russia, targeting another 118 vessels from, bringing the total to more than 560.

These vessels “form part of Russia’s shadow fleet and reportedly two independent Chinese oil refineries,” Patterson added.

Downward pressure:

Oversupply concerns continue to be a key factor limiting Brent’s upward momentum.

More than 1 billion bbls of oil are in transit at the moment, data from tanker tracking firm Vortexa showed earlier, adding some bearish sentiment to the market.

This rise marks the highest level reached since 2020 – during the COVID-19 era, a Bloomberg report said.

Meanwhile, OPEC+ countries have continued to raise output ahead of their planned schedules.

Earlier this month, eight members of the group agreed to collectively increase their production by another 137,000 b/d in November.

By Gautamee Hazarika & Aparupa Mazumder

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