A recent news article published in the Engine states that Americas Bunker Fuel Availability Outlook.
Prompt VLSFO and LSMGO supplies
Prompt VLSFO and LSMGO supplies have been in good availability in Houston recently. Several suppliers can deliver the two grades with 5-6 days or less of lead time. One supplier has tight availability and has its earliest estimated delivery date 9-10 days out.
HSFO supplies were running low on the US West Coast last month, but have shown signs of improvement recently. Los Angeles and Long Beach now price the grade at discounts to other US ports and at near parity with Houston’s.
Low sulphur fuel can be tight on the West Coast and the earliest delivery date for VLSFO and LSMGO with a supplier in Los Angeles and Long Beach is around 10 days.
Availability prospects are mixed between suppliers in San Francisco. One supplier can deliver VLSFO with 5-10 days of lead time, another in a shorter 3-4 days.
LSMGO supply has improved in the New York since a squeeze in early May which saw a premium of nearly $400/mt over Houston. The premium has since come down to $100-150/mt.
US fuel oil inventories grew by 2%
US fuel oil inventories grew by 2% on a monthly average from May to an eight-month high of 28.49 million bbls June, according to the Energy Information Administration (EIA). Stock levels were helped by a third less volume supplied out of storage to bulk terminals, blenders, power generation and further refining.
Fuel oil production came down by 18% to 203,000 b/d, a 13-month low, but helped by a 5% increase in imports to 291,000 b/d. Mexico remained the US’ biggest import source, as it has been since it overtook Russia in April. The US has also increasingly looked towards Algeria for volumes to supplant embargoed Russian barrels, according to Vortexa cargo tracking data.
Availability is tight in Panama. A supplier’s earliest delivery dates for HSFO and LSMGO grades are around nine days out in Balboa. Another supplier’s earliest date in Cristobal is seven days ahead.
LSMGO is particularly tight in Panama
LSMGO is particularly tight in Panama, boosting its prices against ports. Balboa premium over Houston has widened to well over $100/mt.
Bunker availability is tight in port and off Trinidad, but varies between suppliers. One supplier’s earliest delivery date is 10 days out. Another can deliver very prompt.
Prompt product is possible in Brazilian ports, including Rio de Janeiro where the earliest delivery date for VLSFO has come down to just two days out, and four days for 0.50% MGO.
Zona Comun priced VLSFO at unusual discounts to Brazil’s Santos earlier this week. High refinery production in Argentina has been put forward as a reason for competitive VLSFO pricing there lately. Zona Comun’s price has also been at discounts to other Brazilian ports.
Argentina is in the middle of its harvest season and lower prices can attract more bunker demand from vessels loading cargo in its ports.
Zona Comun’s LSMGO price
Zona Comun’s LSMGO price, on the other hand, has been elevated amid a diesel shortage in the country, and priced $100/mt above Balboa’s level. Pressure on diesel supply and prices can drive middle distillate prices, including gasoil, higher. Argentinian state-owned oil company YPF has announced it will import 10 diesel cargoes over the next three months, shipping agent Antares says.
The country is a net importer of diesel and imports have been curbed amid unattractive prices as a result of a domestic currency devaluation and global supply disruptions as knock-on effects from Russia’s war in Ukraine.
Spells of rough weather for periods between Friday and Monday could temporarily disrupt deliveries in Zona Comun.
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