• 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 June 24

09:52 Bulk Terminals 2018 to be held in Hamburg on Tuesday 23 – Wednesday 24 October
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09:48 GTT receives the «Most sustainable service provider» award

2018 June 23

09:44 Port of Long Beach announces $16.8 million project to build infrastructure to support zero-emissions cargo-handling equipment
09:43 CMA CGM announces FAK rates from Asia to Red Sea
09:40 Prosafe wins further work for Safe Swift in the Mediterranean Sea
09:35 Costa Cruises celebrates float out of its first ship for China market

2018 June 22

18:24 Shareholders of Volga Shipping Company approve reorganization
18:05 Port of Los Angeles gives $1 million in grants to 30 local organizations
17:50 Denis Khramov appointed as Deputy Minister of Natural Resources
17:29 RF Government approves resignation of Victor Olersky
17:06 TTS Group ASA secures new contracts for RoRo equipment to China
16:05 CMA CGM announces GRR from India to East Africa
15:51 LUKOIL-Bulgaria Bunker starts operating the Bellona tanker at the port of Constanta, Romania
15:34 Port of Rotterdam Authority, DSM, AkzoNobel Specialty Chemicals, FrieslandCampina, Suikerunie, Gasunie, Groen Gas Nederland, ECN, Energy Academy Europe make recommendations for the smarter use of biomass
14:50 Construction works commence in Tallinn Old City Harbour's Terminal D where Tallink ferries are served
14:27 IMO rolls out ferry safety video
14:03 India to make Chabahar Port in Iran operational by 2019
13:38 First shipbroking companies to join SEA\LNG coalition
13:00 Vympel Shipyard delivers 50th fast patrol boat of Project 12150 Mangust to Russian FSB Border Service
12:36 LUKOIL will pay dividends for 2017 in the amount of RUB 130 per ordinary share
12:12 REMPEC hosts regional workshop on response to HNS spills in Valletta, Malta
11:49 IMO regional workshop to address the impacts of fouling
11:25 Ukraine’s water transport carried 0.1 million passengers in 5M’18, up 17.3%, Y-o-Y
11:03 Ulstein announces naming of the Acta Auriga
10:28 “M/V “VASILIY TATISCHEV ” with IMO number 8885157 refused access to the Paris MoU region for the second time
10:21 Brent Crude futures price up 1.15% to $73.79, Light Sweet Crude – up 1.25% to $66.36
10:00 Cargo transportation by Ukraine’s water transport fell by 10.5% to 1.5 million tonnes in 5M’18
09:38 Yevgeny Pankratov appointed as Director of FSUE Rosmorport’s Sakhalin Branch
09:19 Baltic Dry Index down to 1,347 points

2018 June 21

18:27 Diana Shipping announces time charter contract for m/v Philadelphia with Koch
18:00 CMA CGM announces new rotation on ASAF service
17:56 Russia is in need of small bunkering tankers, LNG bunker supply ships and bunker barges - Damen
17:31 Gate terminal (Gasunie/Vopak) to increase ship loading flow rate
16:58 Antwerp blockchain pilot pioneers with secure and efficient document workflow
16:24 Freeport of Riga Authority joins Cruise Lines International Association
16:02 Danaos Corporation announces comprehensive debt refinancing agreement
15:50 MABUX: All eyes are on what course of action OPEC will call for
15:40 12 LNG bunker supply ships to be put into operation in Singapore by 2025
15:02 Ship garbage recycling pilot wraps up at Port of Brisbane
14:39 Vyborg Shipyard launches port icebreaker Ob built for FSUE Atomflot
14:02 APM Terminals supports World Clean Air Day with App upgrade
13:41 Igor Zolotykh appointed as Harbour Master of port Ust-Luga
13:23 Victor Olersky appoints Igor Ishchenko as Harbour Master of port Primorsk
13:02 EU member states’ experts on ship recycling meet in Brussels
12:39 XI Russian Forum “Current State and Prospects for Development of Russian Bunker Services Market” opens in Saint-Petersburg
12:16 ABS issues industry-leading Guide advancing DC power for hybrid electric applications
12:00 Largest gantry crane in the Nordic countries delivered to Meyer Turku
11:57 HVCC Hamburg Vessel Coordination Center and the Rotterdam Port Authority launch unique cooperation
10:55 CMA CGM to acquire CONTAINERSHIPS, a leader in intra-regional transportation in Northern Europe
10:53 Protecting marine life from ship noise is in the focus of meeting on oceans and the law of the sea
10:28 Brent Crude futures price up 0.41% to $75.41, Light Sweet Crude – down 0.59% to $65.3
10:02 Maritime officials in Morocco undergo training at IMO workshop in Casablanca
09:41 Closer look at the interpretation of maritime law
09:19 Baltic Dry Index down to 1,373 points

2018 June 20

18:00 Lead landing ship of Project 11711, Ivan Gren, joins the fleet of RF Navy
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17:05 Genco Shipping & Trading Limited completes common stock offering
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15:51 Maritime leaders endorse green initiatives for shipping