Spot bunker prices in the Americas strengthened in recent days, with supply concerns in some Latin American ports and subdued demand on the Gulf Coast.

Increases in global oil markets have supported values even if concerns about a new coronavirus strain in the United Kingdom hit the futures market at the start of the week ending Dec. 25.

LATIN AMERICA

Panama has been a center of increased bunkers activity, with solid prices expected to stay strong this week as spot bunker values in the Caribbean hub battle several market factors.

Several trades were heard done Dec. 10 and Dec. 11 for marine fuel 0.5%S in a tight pricing range.

A market source cited a “contradictory war” between higher international prices and slower demand in December that has caused a build in supply.

Brent and ICE gasoil have been increasing like “torpedoes,” the source said. However, as there is plenty of bunkers supply in the Panamanian market, price increases might not accompany the higher values recently seen in the global markers.

“I wouldn’t expect too much of a decline in prices,” the source said of Panama.

The 0.5%S, also known as very low sulfur fuel oil, rose $13/mt (3.3%) from Dec. 14 to Dec. 18, to be assessed at $412/mt in Balboa and Cristobal.

During the same period, Brent ICE February futures contract advanced $1.88/b ($14.27/mt or 3.7%) to $52.20/b, while the wholesale market for the US Gulf Coast rose $10.50/mt (2.8%) to $388.50/mt.

In Colombia, amid persistent talk of supply constraints, VLSFO jumped $34/mt (8.4%) to $440/mt.

“Very limited offer,” a market supplier said.

Guayaquil’s VLSFO market experienced a $15/mt (3.4%) to $455/mt, but spot pricing in other Latin American ports rose more moderately. Santos, which closely follows global markers, advanced $6 (1.5%) to $399/mt.

In Argentina, a strike by oilseed workers and grain inspectors demanding higher salaries has left dozens of ships stranded in some ports, waiting to load exports of wheat, barley and soy. However, bunker prices have only risen slightly, with VLSFO in Buenos Aires gaining $4/mt (1%) to $424 on Dec. 18.

“What we will see is a big blockage once the issue is solved. I don’t think there will be price increases or lack of supplies,” a market participant said.

Another source said supply had become “somewhat tightened”, while a third stated: “More than prices, the stoppages are affecting deliveries, as schedules for ships in terminals have changed.” The stoppages continued unresolved on Dec. 21.

US GULF COAST

Along the Gulf Coast, spot retail 0.5%S pricing continued to be talked in a wide range, resulting in mixed movements between the indications and the notional markets.

Smaller volumes tend to be heard at lower levels due to suppliers keeping time-chartered barges moving, with suppliers making up the cost on steeper barging costs.

Demand fundamentals remained weak, and market activity is expected to remain muted through the end of December amid seasonal destocking efforts for tax purposes.

On an ex-wharf basis, 0.5%S in Houston rose $13/mt (3.5%) to $383/mt last week. In New Orleans, the fuel increased $18 (4.8%) to $393/mt. Marine gasoil registered stronger advances, with Houston’s MGO rising $20 (4.6%) to $455/mt and hiking $25 to $465/mt in New Orleans.

NORTH AMERICA EAST, WEST COASTS

New York and Philadelphia bunkers strengthened the week ended Dec. 18, with a source attributing the price gains to strong energy futures and a tight basis. Retail 0.5%S climbed 5.6% in both New York and Philadelphia. MGO in the ports saw similar gains, as New York and Philadelphia strengthened by 4.5% and 4.7%, respectively. At the start of the week, MGO in Philadelphia was at a $1 premium to New York, and the spread widened to $2 to close the week.

In Charleston and Savannah, IFO 380 rose 2.0% and 2.4%, respectively. According to a source, IFO 380 supply was tight in Charleston. MGO in the ports remained at parity, as both ports climbed 2.7% over the week.

Retail 0.5%S climbed 1.7% in Vancouver, while MGO strengthened by 1.6% in the port. A regional source said prices were firming in line with stronger energy futures, despite weak demand in the region.

Seattle continued to be talked at a $5 premium over Vancouver throughout the week. Seattle retail bunkers saw similar movements to Vancouver, as 0.5%S increased by 1.7% and MGO gained 1.6%.

MGO in Los Angeles strengthened by 1.4% over Dec. 14-18, while 0.5%S gained 3.2%.
Source: Platts