Spot marine fuel bunkers assessments in the Americas enters the week Aug. 23-27 under pressure from recent declines in key global energy futures, with market participants looking to upstream sectors for direction amid ongoing pandemic-related demand concerns.
LATIN AMERICA
Pricing for marine fuel 0.5%S in Latin America fell in almost all key ports following the strong declines seen in global futures and wholesale markets. However, retreats in some ports were milder, as fundamentals in each country prevailed.
In Panama, prices fell as steeply as in the energy complex.
“Strong demand, so suppliers are competing strongly for any business,” a market source said. The 0.5%S in Balboa was assessed at $481/mt on Aug. 20, down $29, or 5.7% from Aug. 16.
“It has been very volatile,” another market source said of the Panamanian market, pointing to movements within the same session last week of up to $5-$7.
During the same period of Aug.16-20, ICE October Brent plummeted 6.4% to $65.18/b, while wholesale 0.5%S on the US Gulf Coast dived 5.6% to $465.50/mt. Concerns about the effects of the coronavirus delta variant on global demand, a stronger dollar and the possibility of higher interest rates in the US combined to take ICE Brent to seven consecutive sessions of declines. However, by Aug. 23, crude futures were experiencing a rebound.
In Santos, Brazil, the 0.5%S fell $17, or 3.3%, to $486/mt.
In Buenos Aires, the bunker fuel declined $17, or 3%, to $543/mt. “It has been veering a lot, it’s been very odd lately,” a source said of the Argentinian bunker market.
In Callao and Guayaquil, the retreats were also sharp. The Peruvian port saw 0.5%S falling $21, or 3.2%, to $639/mt, amid a “slow” market. In the Ecuadorean port, although imports of the fuel have been arriving to the country, one or only few suppliers have avails, according to market sources.
The 0.5%S bucked the downward trend in Colombia and rose $10, or 1.8%, to $566/mt in Cartagena.
“Colombia is usually quite slow to respond to global changes,” a market source said. According to the source, the market in that country has also been slow, amid the competition from the strong declines in neighboring Panama.
Regarding marine gasoil, Balboa, Santos and Callao saw heavy falls after a collapse in prices for this segment marker, the NYMEX September ULSD, which retreated 6.8% last week to $1.9082/gal.
Tracking it, Balboa’s MGO fell $31, or 5%, to $589/mt, in Santos it fell $20, or 2.9%, to $678/mt, and in Callao it dipped $21, or 2.8%, to $729/mt. However, in Cartagena it increased $9, or 1.4%, to $666/mt, and in Buenos Aires it edged up $6, or 1%, to $711/mt.
NORTH AMERICA EAST, WEST COASTS
Spot marine fuel bunkers markets on the East Coast showed a bearish tendency the week of Aug. 16-20, with spot assessments moving lower to track a weaker US crude complex.
In New York, spot 0.5%S marine fuel bunkers pricing came off $19 (3.7%) during the week to close at $498/mt ex-wharf, and the Philadelphia market moved in lockstep to shed $16 (3.1%) on an Aug. 20 close of $503/mt ex-wharf.
MGO spot pricing in the region felt more pronounced pressure from weaker US diesel futures. The New York assessment fell $29 (4.8%) to end the week at $573/mt ex-wharf.
On the West Coast, spot pricing was down across the board on weak demand fundamentals and pressure from declining relevant Asian sectors.
Spot 0.5%S pricing in Vancouver fell $43 (8.2%) from Aug. 16-20 to end the period at $484/mt ex-wharf, while MGO value shed $42 (5.8%) to close the week at $679/mt ex-wharf.
Vancouver pricing remained under pressure amid aggressive pricing from at least one local supplier that was heard forcing another to lower offers.
The Seattle market saw its spread to Vancouver shift as a result, with a local source citing the sharp declines as “causing some disruption” in the regional price relationship.
Seattle spot priced ended the week being talked $8-$10 below Vancouver, down from the usual $15 spread seen in recent weeks.
US GULF COAST
US Gulf Coast spot pricing trended lower the week of Aug. 16-20, with weak demand again leading to a wide range of spot pricing as sources cited aggressive and motivated sellers setting an unworkable floor.
In Houston, spot 0.5%S pricing fell $24 (4.8%) during the period to end the week at $475/mt ex-wharf, and the MGO assessment came off $38 (7.9%) to price at $540/mt ex-wharf most recently.
Both assessments were made in line with supplier indications heard during the day, with a source citing wide price ranges that lack clear differentiators.
“Hard to say why [pricing varies],” the source said. “Specs are similar — guess just different economics for suppliers.”
Source: Platts