AMERICAS BUNKERS: Key market indicators March 8-12

New York — Spot pricing for bunker fuels across the Americas is being anchored in the powerful advance crude futures and wholesale markets have exhibited since the beginning of March.

However, while retail bunkers on the US Gulf Coast have risen in a proportion closer to that of the oil markers they traditionally follow, in Latin America a still restrained demand has limited the extent of price increases, except for Panama.

US Gulf Coast

Marine fuel 0.5%S in Houston climbed $25 in the first week of March to $510/mt ex-wharf. The upward movement compares to a $32 jump in the value for wholesale 0.5%S on the US Gulf Coast, which ended last week at $511.75/mt.

Marine gasoil in the same port climbed $29 (5.2%) to $589/mt. The marker the MGO segment tracks as guidance, the NYMEX prompt-month ULSD contract, rose 6.9% to $1.94/gal.

The advances were more notorious in the port of New Orleans, where 0.5%S jumped $29 to $520/mt and MGO rose to $605/mt, a 6.9% increase, equal to that in the NYMEX ULSD contract.

"Re-supply is tight in New Orleans, and Houston is getting congested," a source said March 5, adding he expected the traffic jam to continue for the following five to seven days out.

On the possible reason for the congestion, the source said: "It is a combination of factors, (winter) storm catch up, limited resupply avails."

Latin America

In Latin America, price increases in the week from March 1-5 were more moderate than in the global oil complex, where ICE Brent futures jumped 9.1% and ICE gasoil climbed 3.9% following the extension of OPEC+ production cuts until April. The limited pace was both due to a lagging reaction in the region and a demand which is struggling to awaken in several ports.

"ICE gasoil has risen in around $20/mt, so we will see in these next few days how the rest of the markets increase," a Latin America bunker source said.

Panama's bunker fuels, which traditionally follow the energy complex more closely, saw a $36 (7.2%) increase in marine fuel 0.5%S in Balboa to $535/mt ex-wharf. Marine gasoil in the port jumped $32 (5.5%) to $610/mt.

"What a market!" a market participant said.

"The market is flying," another one said, pointing to both the energy complex and a stronger demand in Panama's ports, which led to strong trade activity last week.

In Santos, 0.5%S jumped $11 (2.2%) to $522/mt, but marine gasoil showed a hefty advance of $20 (3.2%) to $637/mt. Brazil's Petrobras implemented last week another price increase for domestic wholesale diesel, this time of 5%. It was the fourth increase in 2021.

In Valparaiso, Chile, 0.5%S rose in $32/mt (5.5%) to $611/mt, and the climb was also steep in Callao, of $27 (4.8%) to $584/mt. A market source in the Peruvian port said, however, prices in global markers were the main support in the increase, as demand remains soft.

A similar situation was described in Colombia, where global markers led 0.5%S in Cartagena to jump $15 (2.8%) to $555/mt.

In Ecuador, the high sulfur bunker segment is facing supply constraints, due to a lack of availability from Petroecuador, probably until March 14, a source said. The state-led company halted operations in its SOTE oil pipeline for repairs for 48 hours last week. It also closed last month the catalytic cracking unit at its Esmeraldas refinery for maintenance. High sulfur bunker fuel in Guayaquil rose $8 (2.4%) to $345/mt from March 1-5.

US Atlantic, West Coasts

US Atlantic Coast prices rode the crude complex up, as well, though liquidity has been timid.

Stronger Asian markets lent added support to US West Coast bunker markets, augmenting the US crude rise.

In New York, spot 0.5%S marine fuel retail pricing climbed $22 (4.4%) from March 1-5 to close the week at $527/mt ex-wharf, while Philadelphia's assessment also rose $22 (4.3%) to $532/mt ex-wharf during that period.

MGO spot pricing in New York rose $27 (4.8%) to $587/mt ex-wharf, and the Philadelphia marker tracked to gain $23 (4.1%) to $588/mt ex-wharf.

"New York Harbor looks strong due to some congestion," a source said, adding that Philadelphia prices have been nearly at parity with New York recently.

On the West Coast, the Vancouver spot price of 0.5%S retail marine fuel rose $11 (2.1%) to $531/mt ex-wharf and MGO climbed $17 (2.8%) to $630/mt ex-wharf.

Late in the week, Vancouver offers and indications were talked as high as $535/mt ex-wharf on 0.5%S and $635/mt ex-wharf on MGO. At least one local source called those levels "excessive" while putting values around $13-$15 lower.