Fuel contamination at the Port of Houston earlier this summer had led to a major price rise, steadily this year.
Unusual price trend
Pricing in Houston has trended higher year on year, with the IFO 380 price up by 46.84%, or $137.50/mt, from August 30, 2017, S&P Global Platts Data showed.
Although S&P Global Platts assessed IFO 380 Houston at $433/mt ex-wharf, which was up by $3/mt on the day of Thursday, due to tight supply, had a positive pricing indications as high as $440/mt ex-wharf Houston by EOD.
Upside down
The uptick in IFO 380 price which had marked a change of over $40/mt since August 17 and was on an uptrend, and with only one day left for the month, saw a sudden downshift, wherein the price for IFO 380 had dropped in Houston.
Fuel contamination
Sources stated buyers were wary of purchasing in Houston following the contamination. One source, however, said “those who are confident their product is better than others will be charging a solid premium,” which is indicative of the present market.
Only Houston in the hole
Another source stated they had seen “some refiners selling at higher premiums to guarantee a contaminant-free product,” with some adding up to $1.60/b.
For some time at the least, the market will continue to be down as the expected buyers are being hesitant on making a decision, a source said.
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Source: Platts
