Prices in East of Suez ports have moved in mixed directions, and availability of VLSFO and LSMGO is good across several Taiwanese ports.

IMAGE: An aerial view of Taichung Port. Taiwan Free Trade Zone 1

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

• VLSFO prices down in Zhoushan ($16/mt), Singapore ($7/mt) and Fujairah ($5/mt)
• LSMGO prices unchanged in Fujairah, and down in Singapore and Zhoushan ($19/mt)
• HSFO prices up in Singapore ($1/mt), and down in Zhoushan ($10/mt) and Fujairah ($4/mt)
• B30-VLSFO at a $265/mt premium over VLSFO in Singapore
• B30-VLSFO at a $292/mt premium over VLSFO in Fujairah

Zhoushan’s VLSFO price has fallen by $16/mt over the weekend, the steepest drop among the three major Asian bunker ports. Despite the sharp decline, Zhoushan’s VLSFO price is at premiums of $25/mt over Fujairah and $22/mt over Singapore, respectively.

In Zhoushan, most suppliers are now recommending lead times of 5–8 days for all grades amid low demand. Last week, several suppliers were advising 4–7 days for small parcels across all grades, while larger stems above 1,500 mt required slightly longer windows of 6–10 days.

Across Taiwan, suppliers in Keelung, Taichung, Kaohsiung and Hualien can typically deliver VLSFO and LSMGO within two days, almost unchanged from last week.

Brent

The front-month ICE Brent contract has dropped by $0.68/bbl on the day from Friday, to trade at $60.04/bbl at 17.00 SGT (09.00 GMT) today.

Upward pressure:

Brent’s price has gained upward support following a major geopolitical escalation in Venezuela.

Over the weekend, US troops carried out an operation that resulted in the detention of Venezuelan President Nicolas Maduro and his wife, from the country’s capital Caracas.

Moreover, US President Donald Trump said Washington would take control of the OPEC member nation and confirmed that the US embargo on Venezuelan oil would remain in place.

Venezuela controls almost 17% of global oil reserves, or 303 billion bbls, according to Reuters. The future of its oil output now depends on how US sanctions policy develops, market analysts said.

“Any rehabilitation of Venezuela’s oil sector could take years and billions of dollars in capital,” SPI Asset Management managing partner Stephen Innes said.

Downward pressure:

The total number of rigs drilling for crude oil in the US rose by three to 412 units last week, according to Baker Hughes.

The US oil rig count is seen as an indicator of future oil production. It reflects how much oil drilling activity is happening or expected to happen in the shale sector.

In an oversupplied market, any signal of increased future supply can put downward pressure on Brent’s price.

By Tuhin Roy and Aparupa Mazumder

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