10-08-2016

Bunker fuel prices in Callao and Guayaquil keep under pressure on limited supplies

bunkerfuel

Limited supplies continued putting pressure on bunker prices in Callao, Peru and Guayaquil Monday, Ecuador as oil refineries in those markets are not producing at full rates, market sources said.

IFO 380 prices in Callao and Guayaquil, were assessed at $296/mt delivered and $297/mt delivered, respectively $1 higher from Friday, based on price indications, strong demand and low supplies.

“The situation in Peru is complicated because the [Talara] refinery is producing at low rates and it is hard to satisfy the demand in the bunker market,” a market source said.

Petroperu’s 62,000 b/d Talara oil refinery has been working at 60% of its total capacity due to expansion works, which are expected to last until September, according to the source who asked not to be identified.

Petroperu is the only supplier of fuel oil in the Peruvian market, and most of that production is sold to the export market through tenders, which leaves limited volumes to the bunker market.

Since early July, price indications from Peruvian suppliers have been talked in the mid-$290s/mt, subject to availabilities.

In the competing port of Guayaquil and despite oil refiner Petroecuador lowered $22 its fuel oil August posted price from July, bunker fuel prices have been increasing.

“The main plant [of La Libertad refinery] is still out of service,” an Ecuadorean bunker supplier said Monday.

The 45,000 b/d Libertad refinery comprises three units — Parsons, Universal and Cautivo — and since mid-May one of the units has been offline due to maintenance.

However, there was no consensus among sources on which of the three units is currently down. Attempts to confirm the information with Petroecuador have been unsuccessful.

Petroecuador is the sole supplier of fuel oil in Ecuador and power plants have a priority over the bunker market.

Two Ecuadorean suppliers expected to load new product from the refinery by the end of the week.

“I sold all the product I loaded during the weekend to prompt vessels,” one of the suppliers said.

Price indications and deals with high sulfur bunker fuel in Guayaquil were talked also in the mid-$290s/mt and $300s/mt, subject to liability.

Source: Platts 

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