Americas News
Bunker Demand in Los Angeles has been "Killed"
Low bunker prices in Singapore coupled with strike action that has resulted in continued terminal closures at both Port of Los Angeles and Port of Long Beach has "killed" bunker demand at the ports, suppliers have told Platts.
A six month comparison of bunker prices using Ship & Bunker's price history graph tool shows that since June 11, 2012 IFO380 at Los Angeles / Long Beach tracked Singapore fairly closely until early October, but since then has widened to a Monday premium of $58.50 per metric tonne (pmt).
"Overall the spread being so wide over the last few weeks has killed our demand," a West Coast bunker source said Monday.
Bunker prices in Singapore are remaining low due to ample supply, and large ships are buying their bunkers in Asia and making round trips rather than buying fuel on the U.S. West Coast, Platts' sources said.
Demand has also dropped as some container ships look elsewhere for fuel as ongoing strike action has resulted in the closure of a number of terminals at both Port of Los Angeles and Port of Long Beach, with Ship & Bunker reporting Friday that Port of Los Angeles executive director Geraldine Knatz said it was starting to see "ships divert to other ports, including to Mexico."
The terminals at Port of Los Angeles and Port of Long Beach that were closed on Friday remained closed Monday as the strike action by the International Longshore and Warehouse Union (ILWU) continued, the respective port authorities said.
Specifically, seven container terminals remain closed at Port of Los Angeles, with Port of Long Beach saying three of its six container terminals are closed.
