• 2017 October 19 14:38

    MABUX: Global bunker prices may continue upward evolution next week

    The Bunker Review is contributed by Marine Bunker Exchange

    World fuel indexes have demonstrated firm upward trend during the week. Iraq-Kurdistan rising tension, high OPEC oil cut deal compliance rates and the threat of new U.S. sanctions against Iran have fed optimism in fuel markets.

    MABUX World Bunker Index (consists of a range of prices for 380 HSFO, 180 HSFO and MGO at the main world hubs) also continued upward evolution in the period of Oct.12 – Oct.19:
        
    380 HSFO  - up from 325.57 to 334,29 USD/MT  (+8.72)
    180 HSFO  - up from 365.00 to 372,07 USD/MT  (+7.07)
    MGO         - up from 549.50 to 558.21  USD/MT (+8.71)

    As per the estimation made by the International Energy Agency (IEA), the global oil market continues to make progress, but the ongoing production gains from non-OPEC countries will probably act as a ceiling for aspirations of higher oil prices in 2018. In its monthly Oil Market Report published on Oct.12, the IEA categorized the long list of indicators that suggests the oil and fuel markets have made huge strides this year towards rebalancing. In the second and the third quarter, the global supply/demand balance was in a deficit, putting total inventories on track to drain at a rate of 0.3 million barrels per day (bpd) for the whole of 2017.

    The drawdowns were especially felt in floating storage, oil in transit, and in independent storage. Currently, OECD inventories are only 170 million barrels above the five-year average, a substantial drop from the 318 million-barrel surplus seen back in January. Moreover, stocks even fell in months when they typically rise. All of this progress increased the optimism in the third quarter.

    Besides, the IEA sees the recent strengthening relations between Saudi Arabia and Russia as a sign that two of the world’s largest oil producers have re-committed to do whatever it takes to support the long process of re-balancing. It was also considered as a strong indicator that the OPEC/non-OPEC coalition will at least extend their cuts beyond March 2018 when they meet in a few weeks, perhaps as long as through the end of next year. The possibility of deeper cuts remains opened as well.

    OPEC in turn increased its demand forecast for its oil in 2018, and also said that the oil market could flip into deficit next year. The group said that the world would need 33.06 mil-lion bpd from OPEC, an upward revision of 230,000 bpd from its last forecast. That is the third consecutive month that OPEC has increased its demand projection for 2018 and it underscores the growing confidence in the impact of the collective cuts.

    Another supportive factor is renewed worries over U.S. sanctions against Iran. U.S. President Donald Trump on Oct.13 refused to certify that Tehran was complying with the accord even though international inspectors say it is. Besides, Trump accused Iran of fueling sectarian violence in Iraq. U.S.Congress now has 60 days to decide whether to reimpose economic sanctions on Tehran. The possible impact of this action will be uncertain. Most likely, they’ll be substantially less effective than the sanctions coordinated by the international community prior to 2016: the U.S. will probably go it alone. Shortly after President Trump announced that he was decertifying the nuclear deal, the leaders of France, Germany and the UK issued a joint statement supporting the continuation of the agreement. Iran also said that it will continue to abide by the agreement. During the previous round of sanctions, roughly 1 million bpd of Iranian oil was cut off. Renewed sanctions were unlikely to curtail that level of exports, but it could still be disruptive.

    Escalating fighting in Iraq threatens supplies as well. Iraqi forces unexpectedly seized control of the key oil fields around the city of Kirkuk, which had been under Kurdish control for more than three years. The move sparked concerns over civil war. There were also re-ports that Kurds had shut down some 350,000 bpd of production from major fields Bai Hassan and Avana due to security concerns. Increased fighting, including military operations against Iraq’s Kurdish region could move other regional powers to also take measures. Iran and Turkey still threaten further repressive actions against Kurdistan. Tehran warned the Kurds to back down or be confronted by a combined Iraqi-Iranian military operation. Ankara already threatened to shut pipeline to Ceyhan, which could block most of the 600,000 bpd produced in the north of Iraq.

    The U.S. Energy Information Agency (IEA) reported U.S. output slumped by 11 percent from the previous week to 8.4 million bpd, its lowest level since June 2014 as numerous rigs had to be shut because of Hurricane Nate, which hit the U.S. Gulf coast earlier in October. However, the Agency has also forecast an increase of production output in the country by 81,000 barrels per day in November over October levels. The EIA is also predicting that U.S. crude oil production will hit 9.9 million barrels per day in 2018, a new high for the United States (the previous high was 9.6 million barrels per day, which was reached in 1970). Fore-casts of growing U.S. production apply some additional pressure on oil and fuel prices at the moment.

    China’s import and export growth accelerated in September, suggesting the economy is still expanding at a healthy pace despite widespread forecasts of an eventual slowdown. Im-ports grew 18.7 percent in September from a year earlier. The gain was stronger than the most optimistic forecast. Exports rose 8.1 percent, below forecasts of 8.8 percent but the most in three months.

    China’s politically sensitive trade surplus with the United States rose to a record for a single month (to $28.08 billion from $26.23 billion in August). That could aggravate President Donald Trump’s frequent complaints that the trade balance between the two nations hurts the U.S. economy. Trump in August authorized an inquiry into China’s alleged theft of intellectual property in the first direct trade measure by his administration against Beijing, but the move is not expected to prompt any near-term change.

    Ultimately, the global fuel market looks fundamentally different than it did last year or even last quarter. The sharp drop in global inventories alone is evidence that things are heading in the right direction. We expect bunker prices will continue upward evolution 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 February 16

18:06 CMA CGM announces FAK rates from the Indian Subcontinent to North Europe and the Mediterranean
17:54 Future Outlook Forum will take place on 20 March as part of Intermodal Asia 2018
17:36 Global Container Terminals orders 10 more Konecranes RTGs for its terminals in British Columbia
17:09 University of Kent partnership helps the Port of Dover cut queues and boost efficiency
17:06 Port of Oakland reports 2.1 percent increase in export volume in January 2017
16:58 Container throughput of port Hong Kong (China) up 9.2% to 1.81 million TEUs in January 2018
16:35 Royal Vopak expands Vopak tank terminal (JTT) in the Port of Jakarta - Indonesia
16:05 DP World signs agreement with government of Jammu and Kashmir at World Government Summit
15:53 Murmansk Sea Fishing Port handled 11,600 t of fish in January 2018, up 26.1% Y-o-Y (photo)
15:26 Cargo traffic through NSR in 2017 grew by 36% Y-o-Y to 9.9 mln t
15:25 PPR 5 agrees on the outline of IMO draft guidelines for implementation of the 2020 sulphur limit
15:01 NOVATEK to invest USD 1.5 billion in construction of LNG terminal at Kamchatka
14:37 Rosmorport announces tender for maintenance dredging at Volga-Caspian Canal
14:14 22 icebreaker escort operations performed in eastern part of Gulf of Finland during 24 hours on February 15-16
13:49 TransContainer’s net income in 2017 more than doubled Y-o-Y to RUB 5.42 million
13:25 Nuclear power plant of Vaygach icebreaker breaks Arktika’s record
12:30 Rosmorport appoints Irina Egorova as Chief Accountant of its Vanino Branch (photo)
11:56 BSM and Babcock International Group collaborate on innovative LNG Supply Vessel
11:23 EBRD supports efficient grain logistics in Ukraine
11:00 WFS, Marinvest, IINO, Mitsui, NYK to build four new ocean-going vessels capable of running on methanol
10:28 Research vessel Admiral Vladimirsky leaves Mumbai port, India
10:00 Port of Rotterdam container throughput up 12.3% in 2017
10:00 Brent Crude futures price up 0.51% to $64.66, Light Sweet Crude – up 0.54% to $61.67
09:39 New DNV GL class notations aim to improve stern tube bearing performance
09:34 Bunker prices continue going down at the Port of Saint-Petersburg, Russia (graph)
09:15 Baltic Dry Index down to 1,089 points

2018 February 15

18:27 Largest vessel to call at The Port of Philadelphia arrives from the West Coast of South America
18:06 Ampelmann gangway system installed succesfully on the Wagenborg Offshore's Walk to Work vessel
17:06 CMA CGM announces FAK rates from North Europe to China & Far East
16:57 Bunker market in anticipation of upward correction
16:38 Container throughput drives growth in Rotterdam
16:05 Caterpillar Marine announces upgrades to reman models in commercial and yachting applications
15:57 Kont to build 4 cruise terminals in the Leningrad Region
15:24 Number of maritime accidents in North Sea Canal Area down in 2017
15:04 LUKOIL's hydrocarbon production in 2017 up 2.4% Y-o-Y to 2.23 million boe per day
14:39 Peresvet and Oslyabya, ships of RF Navy’s Pacific Fleet, sail in training zone in Sea of Japan
14:16 UN Environment visits IMO
13:43 Jan De Nul to install wind turbine generators in Germany
13:12 Seaborne cargo throughput in Hamburg was stable Y-o-Y at 136.5 million tons
12:25 Railway infrastructure management issues of importance to Lithuania discussed with EU Transport Commissioner
12:01 ClassNK releases new PrimeShip-HULL (HCSR) software
11:44 Repair of tanker "President Heydar Aliyev" of Azerbaijan Caspian Shipping Company completed
11:17 Fuel oil prices are going down at the Far East ports of Russia (graph)
11:17 RIKON AS plans to launch manufacturing of mobile cranes in the Port of Riga
10:53 18 icebreaker escort operations performed in eastern part of Gulf of Finland during 24 hours on February 14-15
10:26 Posidonia 2018 to host international unveil of industry titans JV – International Maritime Industries
10:02 Brent Crude futures price up 0.81% to $64.88, Light Sweet Crude – up 1.14% to $61.28
09:40 Sailors of RF Navy’s Caspian Flotilla start training for Sea Cup 2018
09:18 Baltic Dry Index up to 1,095 points

2018 February 14

18:14 Tilbury2 examination process begins
17:51 PortXL selected port related start-ups and scale-ups for 2018
17:25 The Finnish Supreme Court did not grant the leave to appeal on the fairway dues dispute between Finnlines and the Finnish State
17:03 Documentation for maintenance dredging at Kavkaz and Taman ports obtains state environmental approval (photo)
16:44 PTP enforced FAS decision on the appeal of Baltic Sea Tug Agency
16:25 CMA CGM announces PSS from North Europe to Canada East Coast
15:52 Rosmorport target classroom opens at Admiral Makarov State University of Maritime and Inland Shipping
15:17 Sberbank and Sovcomflot conclude new USD 106 million project financing agreement
14:53 Container Terminal Saint-Petersburg spent EUR 9.1 million under its development programme of 2017
14:30 Polarcus awarded 4D project in West Africa
14:01 Keel laying ceremony held at AVIC Dingheng shipyard for Sirius Shipping’s first of two Evolution vessels