• 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)




2017 November 23

18:05 CMA CGM announces FAK rates from Asia to Mediterranean
17:54 Mercury-1 ferry of Azerbaijan Caspian Shipping Company successfully passed sea test after major repairs
17:35 Ophir issues update on the status of the Fortuna FLNG project
17:20 Opatija, Croatia hosts three-day conference “The Port of Rijeka, Gateway of the Baltic-Adriatic Core Network Corridor”
17:05 Navantia and Bath Iron Works team for the US Navy Future Guided Missile Frigates
16:50 Throughput of Chinese ports up 7.2% to 7.23 bln t in 10M’17
16:35 COSCO (Guangdong) Shipyard delivers research/survey vessel to Guangzhou Marine Geological Survey
16:05 CMA CGM announces GRI from Asia to ECSA
16:03 Bunker prices may turn into irregular phase in the lead-up to OPEC’s meeting
15:44 Okskaya shipyard lays down the first non-self-propelled oil barge in a series of ten vessels ordered by STLC
15:33 European Sea Ports Organisation welcomes a deadline for global solution on CO2 from shipping
15:00 Ports of Ayr and Troon celebrate delivery of new Scottish-built pilot vessel
14:19 Corvette Soobrazitelny, Baltic Fleet, performed some training missions in piracy affected areas in Gulf of Aden
14:02 Wärtsilä engines and exhaust gas cleaning chosen for new cruise ship
13:23 Navigation 2017 to close in Azov-Don Basin of Russia’s IWW on 1 December 2017
13:02 Oldendorff Carriers receives IBJ Bulk Ship Operator of the Year award
12:36 Russia’s General Board of State Expert Review approves Phase I of Bagayevsky Hydrosystem project
12:10 Ports of Ayr and Troon celebrate delivery of new Scottish-built pilot vessel
11:52 Marine Recruiting Agency goes on with the program of RTG operators training
11:29 Coal exports via Rosterminalugol terminal hit 22 mln t milestone this year (photo)
11:04 MGO prices are still high at the Far East ports of Russia (graph)
10:41 Throughput of port Kaliningrad in Jan-Oct'17 grew by 16% to 11.28 mln t
10:18 Brent Crude futures price down 0.25% to $63.16, Light Sweet Crude – down 0.21% to $57.90
09:53 Ukraine’s water transport carried 0.5 mln passengers in Jan-Oct'17, up 30.2%, Y-o-Y
09:35 Port of Singapore throughput up 5.9% to 519.68 mln t in 10M’17
09:17 Baltic Dry Index up to 1,413 points

2017 November 22

18:02 Throughput of port Vyborg up 13% to 1.24 mln t in 10M’17
17:46 New research reveals ‘golden period’ ahead for the Port of Barrow
17:24 Iceland accedes to air pollution treaty
17:03 MSC receives the ‘Container Line of the Year’ award
16:35 Throughput of port Primorsk in 10M’17 down 9% Y-o-Y to 49.40 mln t
16:03 Scottish energy ports capability directory launched
15:47 Throughput of port Vysotsk up 2% to 14.42 mln t in 10M’17
15:21 Cargo transportation by Ukraine’s water transport down 13.3% to 4.8 mln t in 10M’17
15:03 Otto Energy confirms the installation of the jacket and decks comprising the SM 71 F Platform
14:44 Throughput of port Ust-Luga up 11% to 85.04 mln t in 10M’17
14:36 APM Terminals opens a new era for Puerto Quetzal
14:22 Okskaya shipyard will build a series of six trawlers for fishing company Variant
14:03 Forth Ports installs NORBIT survey system for the Forth and the Tay
13:21 DOF sells the vessel Skandi Møgster
12:39 ABB Ability™ Marine Pilot Vision looks beyond human vision for ship automation
12:16 Crowley provides ATB to deliver jet fuel from U.S. mainland to Puerto Rico
12:15 Throughput of Big Port St. Petersburg up 10% to 44.01 mln t in 10M’17
11:46 Navigation season at the main route of the Volga-Baltic Waterway is over (photo)
11:08 Hapag-Lloyd buys low carbon refrigerant containers from Maersk Container Industry
10:51 Bunker prices are flat at the Port of Saint-Petersburg, Russia (graph)
10:30 Brent Crude futures price up 0.13% to $62.30, Light Sweet Crude – up 0.12% to $56.49
10:07 Wagenborg Offshore chooses ULSTEIN PX121 design
09:44 Composit LLC supports “Hydraulic Engineering Structures of Water Transport” Congress as its Sponsor
09:21 Baltic Dry Index up to 1,396 points
09:07 OOCL introduces new containership OOCL Scandinavia
08:30 INEOS to deliver first ever US ethane from shale gas to China in 2019 using world’s largest ethane carrier
08:07 Further SharpEye™ order for Pakistan Navy Submarine upgrade
07:30 Ekofish Group builds twin-rigger at Damen Maaskant Shipyards Stellendam

2017 November 21

18:24 Navios Maritime Holdings reports 3Q, 9 months financial results
18:19 Philly Shipyard delivers fourth and final product tanker to Kinder Morgan
17:59 Major ASW ship Vice Admiral Kulakov enters Norwegian Sea
17:37 Sokhna World Zone project presented to investors in Dubai
17:23 Mathilde Maersk rescues stranded fishermen
17:12 Tuco and Sea Machines unveil remote controlled ProZero workboats