• 2018 February 22 15:13

    MABUX: Bunker market may continue moderate upward evolution next week

    The Bunker Review is contributed by Marine Bunker Exchange

    World oil prices continued to post gains during the week, rising on the back of a weak dollar and comments from the participants of the OPEC+ deal that bolstered confidence in the longevity of the OPEC cuts. The broader upswing in equity markets also supported fuel indexes.

    MABUX World Bunker Index (consists of a range of prices for 380 HSFO, 180 HSFO and MGO at the main world hubs) also demonstrated moderate upward evolution in the period of Feb.15 - Feb.22:
    380 HSFO - up from 352.86 to 357,07 USD/MT (+4.21)
    180 HSFO - up from 391,79 to 394,36 USD/MT (+2.57)
    MGO         - up from 597.64 to 603,21  USD/MT (+5.57)

    A study from the Oxford Institute for Energy Studies predicts that the standoff between U.S. shale and OPEC could keep oil prices trapped between a price band of $60 and $75 per barrel. If prices rise to the upper end of that band, more shale output will drag prices back down. But the OPEC cuts will prevent prices from falling much below $60.

    Some support to the fuel indexes was rendered by Saudi Energy Minister Khalid al-Falih, who said that OPEC would do better to leave the market tight than end the deal on cutting output too soon.

    Meantime, OPEC and the non-OPEC producers' part of the production cuts deal may have a plan for long-term cooperation drafted by the end of 2018, as they seek to institutionalize their current collaboration into a supergroup of oil producers led by Saudi Arabia and Russia. The idea to follow up on the current OPEC/non-OPEC cooperation came originally from OPEC's Secretary General Mohammad Barkindo. Saudi Arabia confirmed that there is a readiness to continue cooperation beyond 2018. The mechanism hasn't been determined yet, but there is a consensus to continue.

    Besides, OPEC plans to discuss with Russia a new way to measure oil stockpiles. One possible new measurement would be to assess how long existing inventories would meet demand, or forward-day cover. Group of OPEC+ countries considers that more coordination is needed to assess inventories. It is expected that the issue will be discussed on April's meeting.

    Saudi Arabia confirmed it will cut additional 100,000 bpd of its oil production next month and keep its exports below 7 million bpd in March. The kingdom lifted its January production by 23,300 bpd to 9.977 million bpd, but still below its 10.058-million-bpd quota, overcomplying once again.

    Russia's economy in turn may come to feel a negative impact from the OPEC+ oil production cut deal. Russia agreed to cut 300,000 bpd from its post-Soviet record-high oil production of over 11.2 million bpd in November 2016. However, Russian Central Bank warned recently that the OPEC+ deal along with weaker demand for natural gas from abroad will temporary curb a growth in Russian production. Russian oil companies have also complained that the continued production cuts interfered with their growth plans, which led to speculation that Moscow could try to push OPEC for an earlier end to the deal.

    Venezuela is going to look for other buyers of its crude oil, should the United States carry out a threat to impose an oil embargo on the country. A full oil embargo, if made, could have serious consequences for U.S. refineries (that use Venezuela's heavy crude) as well. Meantime the amount of oil Venezuela shipped to the United States over the past year drop sharply: from 23.2 million barrels in January 2017 down to 16.652 million barrels in November. For comparison, in 2005 Venezuelan oil imports to the US were around 50 million barrels.

    The rebound in U.S. production is undermining efforts to curb supplies. It rose last week, hitting 10.27 million bpd, which would be a record if confirmed by monthly figures. November's monthly data showed production in the United States rose to 10.04 million bpd, and the country now ranks second in overall production. The U.S. oil rig count, an indicator of future production, also rose last week by 7 to 798, its highest since April 2015. The EIA expects U.S. production to top 11 million bpd in late 2018, a year earlier than projected last month.

    China's crude oil demand growth could slow down this year to 4.2 percent from 2017 (growth by only 0.5 million bpd) versus 5.5 percent last year. In 2017 China turned into the world's top oil importer as its crude oil imports exceeded those of the U.S. on a monthly basis for most of the year. January crude imports also jumped to a new record, at 9.57 million barrels daily, but forecasts of slower GDP growth may change optimistic projections.

    India's oil imports in turn rose to record highs amid strong economic growth and fuel demand. It pushed crude oil imports to a record 4.93 million bpd in January 2018, up by double digits compared to both December 2017 and January 2017. Economic growth in India is also expected to be strong over the next few years, supporting fuel consumption as a growing number of the huge population enter a higher-income slot and buy their first cars. As a result, India's oil demand may become one of the key oil market drivers in the coming years.

    About 15 super-tankers are currently filled with oil floating off the coasts of Singapore and surrounding Malaysia. That's slightly less than last November, and half the number of tankers used for storage in mid-2017. Onshore tanks in the region are also not booked out any more. The fall in storage could be considered as a sign production restraint started by OPEC+ deal in January 2017 is having the intended effect of reducing a global glut.
    We expect bunker prices will follow the general trend of the global fuel market and continue slight 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 March 22

18:18 Global fuel market to remain relatively stable next week, expert says
18:03 Port of Klaipeda (Lithuania) handled 7.25 million tonnes of cargo in 2M'18, up 6% Y-o-Y
17:45 Transas to return all funds received under state support programme in 2016-18
17:12 Germany based firm offers AIS vessel management tracking systems preventing IUU fishing
16:51 Investments of Tuapse Sea Commercial Port in production development totaled RUB 343 million in 2017
16:30 Rolls-Royce completes the £1.3 million MAXCMAS research project
15:59 Nitrogen deposition in the oceans needs further study
15:30 Acta Marine newbuild successfully completed sea trials
14:30 APL starts new India Pakistan Express 2 Service
14:04 RF Transport Ministry defines procedure for approval of widespread minerals production at Russia’s IWWs
13:33 Open simulation platform launches with new partners
13:12 Volga Shipping Company named “Industry Leader” in “Cargo Shipping Company” nomination
12:58 Wärtsilä Seals & Bearings joins the Green Award scheme in support of clean environment
12:48 WMU Board of Governors meets in Turkey
12:25 MAN Diesel & Turbo partners with Hyundai to build new test-engine facility in Ulsan
12:00 Workshop on prevention and control of shipping and port air emissions being developed as part of GloMEEP-IAPH partnership
11:36 19 icebreaker escort operations performed in eastern part of Gulf of Finland during 24 hours on March 21-22
11:21 Russian Trade and Economic Development Council sign MoU to further strengthen commercial ties with Abu Dhabi Ports
11:14 Bunker prices are flat at the Far East ports of Russia (graph)
10:53 The Maritime Standard announces a special discount for the 2018 Awards
10:27 Brent Crude futures price up 0.01% to $69.48, Light Sweet Crude – up 0.09% to $65.23
10:05 Ukraine’s water transport carried 1,000 passengers in 2M’18, down 64.7%, Y-o-Y
09:41 Cargo transportation by Ukraine’s water transport grew by 41.2% to 0.3 million tonnes in 2M’18
09:19 Baltic Dry Index down to 1,117 points

2018 March 21

18:29 Wight Shipyard wins second order for fast ferry duo from Mexican ferry operator
18:16 Dorian LPG announces third Japanese financing
18:14 GasLog Partners LP announces acquisition of GasLog Gibraltar for $207 million and repayment of intercompany loan
18:04 ABP South Wales achieves new ISO 9001:2016 standard for bulk handling operations
17:42 Port of Gdansk to breathe new life into Dworzec Drzewny Quay
17:20 ABB wins contract to equip two next-generation shuttle tankers with future-proof solutions
17:13 Finnlines decides to exercise the options to lengthen two more ro-ro vessels
17:03 Throughput of Chinese ports up 4.7% to 1.45 billion tonnes in 2M’18
16:39 Pavel Bezmaternykh elected as Director of Eastern-Siberian Inland Navigation Company
16:18 Port of Gdansk overhauls its quays
16:00 Novikombank provides a $100 million loan to STLC
15:47 Huntington Ingalls names two vice presidents
15:21 Gulf Island Fabrication secures contracts for two specialized vessels
15:04 Seatrade Maritime Middle East 2018 to be held in Dubai on 29-31 October as part of UAE Maritime Week
14:42 LUKOIL’s profit in 2017 more than doubled YoY to RUB 418.8 bln
14:23 Wärtsilä and Crowley extend maintenance agreement for 11 articulated tug barges
13:56 IMO launches a video outlining how GMN initiative is uniting MTCCs into a global network
13:29 Ulstein built SOV Acta Auriga completes sea trials
13:11 Dubai will host MARACAD Maritime Innovation Awards on 3 October 2018
13:02 MARACAD 2018 will be held in Dubai on 2-3 October
12:30 17 icebreaker escort operations performed in eastern part of Gulf of Finland during 24 hours on March 20-21
12:09 Port of Quebec to cooperate with Port of Zeebrugge
11:47 Port of Immingham and partners hosted Driving Safety Forward forum
11:39 Vostochny Port JSC exported 5 million tonnes of coal YTD (photo)
10:50 Claimants and defendants in the case on allision of Delta Pioneer tanker with a pier at Primorsk port come to amicable agreement
10:31 Finnlines plans to lengthen two more Ro-Ro ships
10:15 Brent Crude futures price up 0.24% to $67.58, Light Sweet Crude – up 0.25% to $63.7
09:51 ABP's Port of Ayr took delivery of Liebherr crane
09:44 Bunker prices are going up at the Port of Saint-Petersburg, Russia (graph)
09:17 Baltic Dry Index down to 1,122 points
08:08 Scottish ports secure AEO status for Leith, Rosyth and Grangemouth
00:32 Ontario Government accepts Damen proposal for full ferry electrification

2018 March 20

18:20 Sirius Petroleum announces delivery of compact well head systems for Ororo-4 and Ororo-5
18:02 Leningrad Region Governor visits Vyborg Shipyard
17:56 PSA’s Bharat Mumbai Container Terminals enhances Nhava Sheva connectivity with first barge and train volumes
17:40 Van Oord posts results for 2017