Spot retail marine fuel pricing spreads between key US Gulf Coast ports Houston and New Orleans remain elevated in the wake of seasonal weather disruptions and tight supply, sources said April 1.
New Orleans spot pricing for 0.5%S marine fuel bunkers and 0.1%S marine gasoil was assessed $15 higher than Houston to open April, in line with an elevated spread heard in March.The Houston 0.5%S spot price rose $12 day on day to $475/mt ex-wharf and MGO value climbed $7 to $560/mt ex-wharf.
The New Orleans assessment tracked to come to $490/mt ex-wharf on 0.5%S and $575/mt ex-wharf on MGO.
"Some congestion still around, resupply still tight," a supplier source said of the New Orleans market. "And with the spring thaw resulting in high river levels and fast currents starting, there will begin to be difficulty reloading. All this means we will continue to see the margin compared to Houston propped up, maybe even going higher."
The spreads between New Orleans had previously been narrowing in each of the first two months of the year, but March saw logistical issues emerge and the spread widen as a result.
Retail 0.5%S spot pricing in New Orleans was on average $12.50/mt higher than in Houston in 2020, according to S&P Global Platts data. That spread had narrowed this year to averages of $8.20/mt in January and $7.50/mt in February, Platts data shows.
In March, the 0.5%S spread widened to an average of $13.90/mt and the MGO spread widened to an average of $14.40/mt, Platts data shows.
A source put New Orleans spot pricing at "$15 or more" above Houston to open April.
On the wider energy front, the May NYMEX ULSD contract rose 6.18 cents/gal ($19.34/mt) to 183.16 cents/gal, while the June ICE Brent contract rose $2.09/b ($15.86/mt) to $64.83/b.
