• 2017 February 16 17:08

    Expert says bunker prices may continue mixed trends next week

    The Bunker Review was contributed to IAA PortNews by Marine Bunker Exchange

    World fuel indexes continued irregular fluctuations this week while market focused on two main drivers: OPEC’s supply-cut deal and rebound in U.S. drilling activity. The IEA increased its 2016 estimates for world oil demand growth for a third month, and boosted its outlook for 2017, anticipating an increase of 1.4 million barrels a day this year. It also predicts that world oil inventories will fall by 600,000 barrels a day during the first half of the year if OPEC sticks to its agreement. While stockpiles in industrialized nations have declined for five months in a row, they still remain significantly above average levels.

    MABUX World Bunker Index (consists of a range of prices for 380 HSFO, 180 HSFO and MGO at the main world hubs) edged up slightly in the period of Feb.09 – Feb.16:
     
    380 HSFO - up from 303.57 to 310.57 USD/MT (+7.00)
    180 HSFO - up from 346.14 to 351.57 USD/MT (+5.43)
    MGO         - up from 529.07 to 530.71 USD/MT (+1.64)


    OPEC cut its crude oil production by 890,000 bpd from December to average 32.14 million bpd in January. Production in January decreased the most in Saudi Arabia, Iraq and the UAE, while production in Nigeria, Libya and Iran increased. The cartel did not provide a compliance rate percentage, but as per different estimations it is around 90-93 percent.

    Secondary sources figures show that Saudi Arabia cut deeper than promised, and reduced output to below 10 million bpd last month, to 9.946 million bpd, down by 496,200 bpd compared to December  (more than the 486,000-bpd-cut it promised in the deal).

    On the other hand, Iraq, Venezuela, Angola and Algeria cut less than promised, while production in Nigeria rose by 101,800 bpd, Libya’s output increased by 64,700 bpd, and Iran’s output rose by 50,200 bpd. Nigeria and Libya were exempt from the cut-deal while Iran was allowed by raise its production slightly, by up to 90,000 bpd.

    The additional cuts of 558,000 bpd promised from non-OPEC countries is a little less clear -  the IEA projects that Russia has slashed output by 100,000 bpd in January. Russia promised to cut 300,000 bpd over the course of the six-month compliance period. Data from other countries is also unclear although the IEA said that Oman appears to have reduced output by 45,000 bpd.

    Russia for its part will decide in April or May on whether to extend the output-cut deal with OPEC. There are signs that country’s output may be falling but that exports remain high, as its producers protect their export markets at the cost of lower domestic supplies. Taken these trends under consideration, OPEC might have to extend its cuts for a longer period than the currently planned first half of 2017.

    Nevertheless, that is a good sign that the oil market is adjusting towards some stage of bal-ance. As per IEA, if OPEC can continue with its high compliance rate, global oil inventories could decline by around 0.6 mb/d on average between January and June.

    The factor of risk is that oil supplies outside and within OPEC may increase in near-term outlook, offsetting the progress made by the OPEC deal. Rising production in Canada, Brazil and the U.S. may transform in additional 750,000 bpd in 2017.

    In the United States rising drilling activity is pushing up production. Drillers added 8 oil rigs in the week to Feb. 10, bringing the total U.S. count to 591, the most since October 2015. During the same week last year, when prices were around $30 per barrel, there were just 439 active oil rigs.

    Besides, some 10 million barrels of crude from the U.S.'s strategic reserve are scheduled to be sold later this month. The shipment is part of a total 25 million barrels, to be sold over a period of three years. It represents less than 2 percent of the strategic reserve’s current capacity, which is calculated at 695.1 million barrels. As such, the sale is unlikely to have a lasting impact on fuel prices, although a brief fluctuation is likely.

    Demand growth from China and India might not be as supportive as 2016. China’s crude imports in January slipped from a record as refiners eased buying before the Lunar New Year break, when industrial activity tends to slow during the country’s most-important holiday.

    India’s monthly oil demand also fell the most since May 2003 adding some pressure on global fuel indexes at the moment. This decline in demand is due to demonetization: Prime Minister Narendra Modi in November withdrew high-value currency notes in a country where almost all consumer payments are in cash. Growth in gross domestic product may slow to 6.5 percent in the year through March from 7.9 percent the previous year.

    The present market situation looks like oil producers will have to cut production more quickly to drain the global oversupply this year while rising production in the United States is undermining OPEC’s efforts to cut oil output. We expect irregular changes in bunker prices will continue next week.

     

     

     

     

     

     

     

    * 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)




2018 April 24

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18:29 Summa Group and Rosneft denied holding negotiations on Novorossiysk Commercial Sea Port
17:30 Future perspectives for maritime industry to be studied at Maritime Future Summit (MFS) during SMM
17:06 PSA and GeTS to develop new global trade facilitation & supply chain platform “Calista™”
16:47 Safety and innovation on the agenda for Danish Maritime Days
16:26 Fincantieri delivers FREMM “Federico Martinengo” to the Italian Navy
16:04 British Ports Association calls for funding commitments to deliver on welcome first steps on port connectivity
15:35 NIBULON transports Ukrainian metal by water
15:04 STASCo signs contract with BMT for navigation simulator REMBRANDT
14:37 ESPO applauds EU role in achieving the IMO agreement on CO2 reduction target for shipping
14:28 Tallink Group’s consolidated revenue in 2017 amounted to EUR 967.0 million
14:04 Seafarer issues to be highlighted during 105th session of IMO's Legal Committee
13:32 HHLA to strengthen and expand its intermodal activities through its rail subsidiary Metrans
12:56 Bunker prices are going down at the Far East ports of Russia (graph)
12:33 Aleksey Kadilov elected as Director General of Baltiysky Zavod (photo)
12:09 US Federal Maritime Commission to examine trucking & delivery arrangements
11:45 Russia’s General Board of State Expert Review approves yet another phase of project on construction of Zvezda shipyard (photo)
11:09 CMA CGM announces GRR from Asia to East Africa
10:45 Foreship takes world’s leading CFD simulation software, StarCCM+ into use
10:30 ABP shortlisted for two Humber Renewables Awards
10:22 Brent Crude futures price down 0.04% to $74.03, Light Sweet Crude – down 0.13% to $68.31
10:08 Nakilat is the first company in Qatar certified for ISO45001
09:39 Freeport of Riga Authority along with several port companies visited TransRussia 2018
09:17 Baltic Dry Index up to 1,306 points
09:08 Compensation regime for Hazardous and Noxious Cargoes a step closer - IMO
08:48 City of Antwerp and Antwerp Port Authority start urban mission to Moscow and St. Petersburg

2018 April 23

18:06 World’s largest short sea Ro-Ro vessel MV Celine christened at Dublin Port
17:52 Digital Ship’s Maritime Big Data Forum will be held on 29 May 2018 in Oslo
17:36 Ocean Rig announces agreement to postpone delivery of newbuilding drillship Ocean Rig Santorini
17:20 Construction of Bagayevsky hydrosystem begins in Rostov Region (photo)
17:05 ITF urges Hutchison Ports to improve global health and safety operations
16:35 Polskie LNG conduct a technical dialogue on extension of LNG Terminal in Świnoujście
16:29 Rosmorport’s icebreakers assisted over 5,700 vessels in freezing seaports of Russia this winter navigation season
16:05 Hapag-Lloyd plans 20 percent reduction in CO2 emissions by 2020
15:55 Azerbaijan Caspian Shipping Company to provide additional scholarships for students
15:33 TransContainer’s net profit in QI’2018 increased by 19.5% Y-o-Y to RUB 1.479 million
15:04 M.v. Tucana delivers fibre optic cable baskets from Drammen (Norway)
14:47 Port of Gdansk (Poland) throughput up 44% to 12.7 million tonnes in January-March 2018
14:31 Average wholesale prices for М-100 HFO in RF spot market up to RUB 13,542 per tonne
14:10 ICTSI PNG units ink union agreements
13:59 MOL сrude oil tanker rescues a castaway in the South China Sea
13:39 Container barge transport to become more efficient in the port of Antwerp
12:48 Cargo transportation by Ukraine’s water transport fell by 7.3% to 0.7 million tonnes in 3M’18
11:46 Vistula Maersk makes a maiden call to St. Petersburg, as first in series of new ice-class vessels
11:13 2 icebreaker escort operations performed in eastern part of Gulf of Finland during 24 hours on April 22-23
10:51 Training ship Perekop completes unofficial visit to Republic of Sri Lanka
10:25 Brent Crude futures price down 0.04% to $74.03, Light Sweet Crude – down 0.13% to $68.31
10:04 Workshop on IMO's ISPS Code held in Mexico
09:40 Training on ship air pollution and low carbon measures held in Tehran
09:17 Baltic Dry Index up to 1,281 points

2018 April 22

15:33 Port of Rotterdam Authority to realise tide pools along Calandkanaal
15:32 British Ports Association raise border facilities' concerns with PM
15:31 Hapag-Lloyd to revise the Fuel Surcharge for Inland Haulage under Carrier arrangement from Germany to Belgium and Netherlands
15:30 JAXPORT names Interim Chief Financial Officer
15:28 Seaspan announces senior management change

2018 April 21

15:06 MV Thuringia makes maiden CI3 service call at Chennai International Terminals
15:04 Diana Shipping announces time charter contract for m/v Arethusa with Glencore
15:00 Gothenburg Port Authority publishes Sustainability Report for 2017
14:47 Wärtsilä welcomes global shipping’s agreement to cut greenhouse gas emissions
14:45 Vopak to invest in new storage capacity at its Rotterdam terminal