• 2017 January 12 15:32

    Bunker prices may continue slight upward trend next week, expert says

    The Bunker Review is contributed by Marine Bunker Exchange
     
    World fuel indexes have started the year with a positive trend. However, prices declined sharply at the start of this week on fears of rising U.S. shale production and a reversal of speculative bets by hedge funds and other money managers, a sign that optimism in crude prices might be reaching its limits. There are two major potential drivers at the moment, each pushing in opposite directions on the market. The OPEC deal is going to take oil off the market, while U.S. drilling is expected to add new supply. Each of the trends may ultimately drive fuel prices one way or the other.

    MABUX World Bunker Index (consists of a range of prices for 380 HSFO, 180 HSFO and MGO at the main world hubs)  demonstrated insignificant and irregular changes in the period of period of Jan.02 – Jan.12:

    380 HSFO - down from 322.36 to 317.71 USD/MT (-4,65)
    180 HSFO - down from 360.64 to 358.00 USD/MT (-2,64)
    MGO         - up from 529.36 to 530.57 USD/MT      (+1,21)


    OPEC’s crude production fell by 310,000 barrels a day in December, as unplanned disruptions in Nigeria reduced the group’s supply. Nigeria’s daily output dropped by 200,000 barrels to 1.45 million in December, ending three months of gains as the African nation struggled to restore capacity after a year of militant attacks on oil infrastructure.

    Overall, the Organization of Petroleum Exporting Countries - excluding Indonesia which suspended its membership on Nov. 30 - pumped 33.1 million barrels a day in December. That compares with a November total of 33.41 million barrels a day for the 13 continuing members of the group, or 34.14 million including Indonesia’s daily output of 730,000 barrels.

    At the moment there are early signs that OPEC members are meeting their commitments. Saudi Arabia said last week that it is lowering its production in January by 486,000 barrels per day, a volume that it promised to cut as part of the November deal. That will take output down to 10.058 million barrels per day, a level that was required to meet as an average over the January to June time period. This step increases the chances that OPEC will stay true to its promises.

    Kuwait and Oman in their turn also give the first signs the curbs are being implemented. OPEC member Kuwait has reduced output by 130,000 barrels a day to about 2.75 million a day.  Oman is cutting 45,000 barrels a day from 1.01 million.

    Russia’s oil production has shrunk by around 130,000 barrels a day in the first week of January (initial goal was to cut at least 50,000 barrels a day this month).  Kazakhstan in turn cut production by 20,000 barrels a day in January. The combined 150,000 barrels a day cut represents 27 percent of the promised reduction by non-OPEC countries.

    There are, however, also signs that doubts about the compliance of OPEC and non-OPEC parties to the production cut agreement are growing. Unlike in the U.S., where output is pub-lished weekly, members of the Organization of Petroleum Exporting Countries can take much longer time to disclose their production. Besides, their data can be put into the question by independent surveys. So each new hint on the accord’s implementation may swing prices.

    The first indications are expected to come at the start of next month, when Bloomberg, Thomson Reuters and Platts publish surveys of production. A week or two later the estimates from the International Energy Agency and U.S. Energy Information Administration will be published. OPEC won’t publish production levels until the middle of next month. Monitoring the 11 non-members collaborating in the deal could be even harder, as data for the smaller producers like South Sudan and Equatorial Guinea could be rather fragmentary.

    Among other minor worrying signs: the U.S. announced on January 9 a notice of sale from its strategic petroleum reserve, with plans to sell 8 million barrels for delivery over the course of February, March and April. Meanwhile, Libya is seeing rapid gains in oil exports after the reopening of a key export terminal, with output rising to 700,000 bpd (it produced 580,000 in November). Nigeria – which, like Libya, is exempt from the OPEC deal – is intent on restoring production too. That could put additional pressure on prices.

    Besides, a report at the end of last week showed another solid build in the U.S. rig count by 4 to 529, the tenth consecutive week that the oil industry added active rigs. This is the highest level since the week ended Jan. 1, 2016. Companies have added more than 100 rigs since the end of September. As per some forecasts, the U.S. rig count to rise to 850-875 by the end of the year, with spending on exploration and production set to increase 27 percent in North America. It is unclear at the moment, how rising U.S. supply and falling OPEC output will ultimately balance out.

    All in all we expect slight upward trend will prevail in the dynamics of global bunker prices next week as news of the OPEC nations maintaining their quotas will provide a temporary support.

     

     

     

     

     

     

    * MGO LS
    All prices stated in USD / Mton
    All time high Brent = $147.50 (July 11, 2008)
    All time high Light crude (WTI) = $147.27 (July 11, 2008)




2017 June 27

18:36 Hapag-Lloyd to implement new GRI for all dry, reefer, flat rack and open top containers from East Asia to US and Canada
18:06 JAXPORT Board of Directors unanimously approves start of Jacksonville Harbor Deepening
17:52 Vympel Shipyard launches fourth Grachonok-class boat of Project 21980
17:36 DNV GL updates the widely used recommended practice for free spanning pipelines
17:24 Vyborg Shipyard hosted meeting focused on localization of ship equipment production in the Russian Federation
17:06 DOF Subsea contract awards in the North Sea and in Canada
16:43 Panama Canal commemorates one-year anniversary of expanded Canal
16:40 Coal exports via Rosterminalugol terminal hit 11 mln t milestone this year (photo)
16:19 Wood Group secures FEED for Alexandroupolis LNG project in Northern Greece
16:12 Port of Helsinki publishes instructions for the safe LNG bunkering of ships
15:55 Insolvency administrator and representatives of Port Equipment LLC shut off from company assets at the port of Vyborg
15:47 Damen Multi-role Aviation Training Vessel arrives in home port of Sydney, Australia
14:44 Krylov State Research Center announces opening of its 40-MW electrical test unit on 28 June 2017
14:26 NYK selected for FTSE4Good Index for the 15th straight year
14:22 Russia’s General Board of State Expert Review approves construction of utilities for sea terminal in Pionersky (Kaliningrad region)
14:03 Norway to implement maritime broadband communication on ships and planes in public service
13:47 Glosten completes design of 150-passenger hybrid electric ferry for Kitsap Transit
13:30 Wan Hai Lines enhances China - Southeast Asia service network
13:23 Goodman increases warehouse space at its logistics centre at the Port of Gdansk
13:17 DFDS Logistics uses biofuel for trucks in Gothenburg
12:58 Bunker prices go up at the Far East ports of Russia (graph)
12:07 RF Navy’s missile ships practiced interaction in the Baltic Sea
11:39 Arctic Economic Council welcomes Statoil as Northern Partner
11:15 NIBULON launches the last tugboat in a series of three vessels of Project 121M
10:48 Ministry of Infrastructure of Ukraine appoints new Head of USPA's Nikolaev branch
10:16 New Skangas Board member appointed
09:52 Brent Crude futures price up 0.28% to $46.17, Light Sweet Crude – up 0.23% to $43.48
09:35 Passenger Port of St. Petersburg welcomed 19 cruise ships last week
09:13 Baltic Dry Index up to 884 points

2017 June 26

18:04 2 MOL-operated / managed vessels selected as 2016 'Best Quality Ships Award'
17:51 Gas from Lithuanian LNG terminal will be stored in the Latvian Inčukalns storage facility for the first time
17:34 EUROGATE publishes first sustainability report
17:04 Diving support vessel Redsborg from the Wagenborg Offshore sets direction to St. Eustatius
16:48 Murmansk Region and Gazprom Geologorazvedka sign agreement on social and economic development
16:34 ZIM deploys an 11,000 TEU vessel in the Asia-ECSA Trade
16:04 Upcoming State of the Baltic Sea report to be in focus in the 2018 HELCOM Ministerial Meeting
15:50 Baltic Sea Tug Agency provided towing and mooring services to the largest bulk carrier welcomed by the port of Ust-Luga (photo)
15:34 Aker Solutions to supply umbilicals for Mozambique's first offshore field development
15:04 DEME’s subsidiary GeoSea to install offshore foundations for EnBW offshore wind farm Albatros in Germany
14:38 Nevsky Shipyard will launch dry cargo vessel of Project RSD 49 on 29 June 2017 (photo)
14:19 Damen prepares Columbus for summer cruise season
14:15 Average wholesale prices for М-100 HFO down to RUB 9,573 in RF spot market
13:49 Rosterminalugol welcomed the largest bulker in the history of Ust-Luga port (photo)
12:56 Upcoming State of the Baltic Sea report to be in focus in the 2018 HELCOM Ministerial Meeting
12:03 New City Terminal entrance improves accessibility of Rotterdam’s city and port
11:34 Port of Rotterdam Authority contracts four PortXL start-ups
11:11 Baltic Sea Tug Agency LLC assisted floating crane involved in lifting of sunken barge (photo)
10:48 Decade-old Betuwe Route crucial for sustainable growth of port of Rotterdam
10:25 Seafarer abandonment was the subject of a seminar held at IMO Headquarters
10:00 Brent Crude futures price up 0.98% to $46.22, Light Sweet Crude – up 1.09% to $43.48
09:37 Nevsky Shipyard starts mooring trials of salvage tug Kalas
09:16 Baltic Dry Index up to 870 points

2017 June 25

14:10 NYK Rumina receives Japanese Pilots' Best Quality Ship Award
14:08 JAXPORT welcomes largest containership to ever call a Florida port

2017 June 24

08:22 Viking Cruises christens Viking Sky in Tromsø, Norway
08:20 Atlas Maritime join the V8 Pool
08:08 Van Oord starts collaboration with start-up acceleration platform PortXL
08:06 Day of the Seafarer is on 25 June

2017 June 23

18:04 CMA CGM announces PSS from Asia to North Europe
17:50 Severnaya Verf will launch the Gremyashchy, corvette of Project 20385, on 30 June 2017