• 2018 May 24 16:15

    MABUX: Bunker prices continue upward trend

    The Bunker Review is contributed by Marine Bunker Exchange

    World oil indexes have demonstrated firm upward trend during the week (despite of slight de-cline on May 23 due to an unexpected build in U.S. crude and gasoline inventories) and were at their highest in three and a half years.  Geopolitics continued to be the main supportive factor: the market grows increasingly wary over possible supply outages due to US sanctions on Iran, Venezuela’s crisis, and OPEC’s adherence to its production cut deal.

    MABUX World Bunker Index (consists of a range of prices for 380 HSFO, 180 HSFO and MGO at the main world hubs) also demonstrated slight upward trend in the period of May.17 – May 24:
        
    380 HSFO - up from 442,21 00 to 448,64 USD/MT(+6.43)
    180 HSFO - up from 480,64 to 487,29 USD/MT     (+6.65)
    MGO        - up from 708.79 to 714,43 USD/MT     (+5.64)

    The International Energy Agency (IEA) is ready to act if necessary to ensure that markets re-main well supplied. The agency is talking to both oil producers and oil consumers as crude prices recently reached their highest level since November 2014 on the back of heightened geopolitical concerns. Two weeks ago the IEA said that the restoration of sanctions on Iran may have implications for the market balance, adding that it is closely following the situation. Saudi Arabia in turn suggested shortly after the U.S. announced its withdrawal from the Iran nuclear deal that OPEC would act to mitigate any supply shortfall should it occur.

    OECD crude inventories fell in March by 27 million barrels, putting total stocks at a three-year low and, crucially, 1 million barrels below the five-year average. OPEC has claimed for more than a year that it was trying to erase the inventory surplus, and at least according to IEA data, that mission has now been accomplished.

    Meantime, OPEC and Russia were discussing price volatility on the oil market. It is expected that OPEC would step in to mitigate supply losses, although for now, the preference is to leave the production limits unchanged. OPEC officials have said the price rally is being driven by fear and not based on the fundamentals.

    Also, one of the main market’s concerns is additional U.S. sanctions against Venezuela after President Nicolas Maduro was re-elected for a six-year term. The process has been criticized by the United States, the European Union and major Latin America countries. Possible sanctions could hurt Venezuelan oil supply further, already reeling from lack of maintenance and state-run PDVSA’s inability to pay its bills. Most recently, the company elected to close its refinery in Curacao after ConocoPhillips has seized oil as it seeks to collect on a $2 billion court award. Barclays said output from Venezuela could fall below 1 million barrels per day while the country produced around 1.4 million bpd in April.

    Ahead of U.S. sanctions on Iran, U.S. Secretary of State Mike Pompeo threatened even tougher sanctions against the Islamic Republic. Pompeo claimed the sanctions would be the strongest in history when complete. The White House also laid out new demands for Iran on May 21, which said any new nuclear deal with the U.S. would require Iran to stop enriching uranium and to pull its support for militant groups in the Middle East.

    Iran in turn prepares for some disruption in its oil industry after the reintroduction of U.S. sanctions and would probably rely mostly on its biggest buyers: China, India and the European Un-ion. All of them have clearly indicated they had no intention to stop buying Iranian crude, with the EU specifically signalling it would make an effort to uphold the Iran nuclear deal and shield companies doing business in the country from U.S. sanctions.

    Meantime, President Trump is also pressuring Germany to scrap the Nord Stream 2 natural gas pipeline from Russia if it wants to avoid a trade war with the United States. Trump reportedly told German Chancellor Angela Merkel that the U.S. would restart talks with the EU on a trade deal in exchange for Germany cancelling the Nord Stream 2 pipeline.

    U.S. commercial crude inventories surged by 5.8 million barrels in the week-ending May 18. Traders were looking for a drawdown of 2.5 million barrels. U.S. crude oil exports dropped by more than 800,000 barrels a day last week to about 1.75 million barrels a day. Additionally, crude imports were up to 558,000 barrels.

    US oil production rose again in the week ending May 11, reaching 10.725 million bpd—the thirteenth build in as many weeks—and less than 300,000 bpd shy of the 11.0 million bpd forecast that many are predicting for 2018. US production has steadily increased since OPEC engaged in a supply cut deal. At the time the deal was announced, the US was producing 8.6 million bpd. Today, the US is producing more than 2.0 million bpd over that figure, while OPEC/NOPEC continues to curb supply on its end. Meantime, the U.S. oil rig count held steady at 844 last week after rising for six weeks in a row.

    There is a sign of hope that ongoing trade tensions between Washington and Beijing could be remedied. China said that it agreed to significantly increase its purchases of American goods and services, including energy and agricultural commodities. The disclosure came after the conclusion of intensive trade talks in Washington on May 19. A joint statement said, there was a consensus on taking effective measures to substantially reduce the United States’ trade deficit in goods with China. However, the two sides did not indicate if they would either delay or drop trade tariffs threats.

    China’s crude oil inventories rose by 65.3 percent between March and April, or by 37.84 mil-lion barrels on the back of lower refinery throughput rates and higher imports. This month should see another increase in oil stocks as imports remain robust. These hit a record high last month, at 9.64 million barrels daily, up by 14.7 percent on the year and by 4.1 percent on the month. But while China has been importing more crude, the source pattern of this crude has been changing. Earlier this month, Sinopec said it will cut crude oil shipments from Saudi Arabia by 40 percent in June, after it did the same with May shipments, after Riyadh surprisingly raised the price of its light crude for Asian clients. At the same time, Beijing has assured Iran it will continue buying crude from it despite U.S. sanctions.

    We expect geopolitical tensions in the Middle East and the situation in Venezuela will continue to support prices at least until OPEC’s next meeting with Russia, due in a month, when an announcement of quota easing might pressure them further. So bunker prices will continue upward evolution next week.

     

     

     

     

     

     

    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)




2019 January 19

16:19 Ocean Yield acquires Suezmax tanker Milos for $56.0 million
15:16 Evac expansion continues with acquisition of UK service company Transvac Systems
14:02 Deltamarin contracted to continue with Titanic II project
12:51 SGRE launches 10 MW offshore wind turbine
11:44 Algoma increases its interest in the ocean self-unloader Pool

2019 January 18

18:06 North Carolina Ports sets new record in 2018
17:47 Freight turnover of Neva-Metal (Saint-Petersburg) in 2018 climbed by 3% Y-o-Y to about 3.2 million tonnes
17:25 Okskaya Sudoverf obtains patent for state-of-the-art pontoons
17:06 Hamburg prepares for ‘Hard Brexit’
16:44 Throughput of port Primorsk in 2018 fell by 7% Y-o-Y to 53.48 million tonnes
16:23 GTT receives a new order from SHI to design the tanks of two LNG carriers on behalf of Gaslog
16:20 NOVATEK elects new Board of Directors
15:56 Throughput of port Vyborg in 2018 grew by 25% Y-o-Y to 1.93 million tonnes
15:33 Stena Line’s first new generation ferry ‘floats’ in China
15:21 Bunker sales at the port of Singapore in 2018 fell by 1.7% Y-o-Y to 49.8 million tonnes
15:03 Panama Direct service CMA CGM to resume weekly rotations
14:47 Throughput of port Vysotsk in 2018 climbed by 7% Y-o-Y to 18.79 million tonnes
14:33 GranIHC appointed contractor for Equinor’s Peregrino Phase II Project
14:19 Port of Ust-Luga handled 98.72 million tonnes in 2018, down 4% Y-o-Y
14:03 Algoma Central Corporation increases its interest in ocean self-unloader Pool
13:50 18 vessels escorted by icebreakers in eastern part of Gulf of Finland during 24 hours on January 17-18
13:35 Throughput of the Port of St. Petersburg in 2018 up 11% Y-o-Y to 59.32 million tonnes
13:18 CMA CGM unites its Containerships and MacAndrews brands
13:11 Vladimir Putin supports Government’s proposal on expanding Far East Ministry’s functions with Arctic issues
12:49 Throughput of port Kavkaz in 2018 grew by 11% Y-o-Y to 49.276 million tonnes
12:26 MV Werften purchases Neptun Ship Design
12:08 Sakaide shipyard holds naming ceremony for new LNG carrier jointly owned by NYK and JERA
11:38 PGNiG SA signs agreement for oil and gas exploration and production in UAE
11:14 Remote pilotage to be allowed in Finland
10:47 Free zone status is a crucial advantage for the future development of the Freeport of Riga
10:06 Ice restrictions at the port of Ust-Luga come into effect on January 31
09:42 Brent Crude futures price up 0.9% to $61.73, Light Sweet Crude – up 1.09% to $52.64
09:20 Baltic Dry Index is up to 1,077 points

2019 January 17

18:13 PORT OF KIEL presents annual results 2018
17:51 Ice restrictions at the port of Primorsk come into effect on January 25
17:28 Global Ports sets up a common service call centre
17:09 EFIP welcomes and supports the European Parliament position on the Connecting Europe Facility for 2021-2027
17:05 North Sea Port monitoring the Brexit closely
16:44 ABP invests £700K to boost storage at Port of Ipswich
16:27 Global fuel market: still many uncertainties in both demand and supply
16:22 CMA CGM announces FAK rates from ISC to North Europe and the Mediterranean
16:05 OCEAN Alliance extends duration of OCEAN Alliance to ten years
15:42 COSCO SHIPPING Ports signs agreement with PSA to add two new berths at the terminal in Boao, Hainan
15:31 Liebherr supports the 6th International Forum of Dredging Companies as its Sponsor
15:02 Ocean Yield ASA agrees to acquire a modern Suezmax tanker for a consideration of USD 56.0 mln
14:02 SEACOR Marine enters agreement to acquire three additional platform supply vessels from affiliates of COSCO Shipping Group
13:49 Throughput of Chinese ports grew by 4.2% to 9.22 billion tonnes in 2018
13:32 Jensen Maritime provides design for Shaver Transportation’s new tugboat
13:14 OOCL rolls out third phase of Ocean Alliance product refinements
12:50 Baltic Ports Organization’s schedule for 2019 is set
12:38 Port of Los Angeles breaks all-time cargo record in 2018
12:26 Qatar accedes to load lines convention
12:01 Sunseeker International and Rolls-Royce to present first production yacht with MTU hybrid power in 2020
11:51 Bunker prices continue going down at the Far East ports of Russia (graph)
11:38 Port of Zeebrugge handled 40.1 million tonnes in 2018
11:25 Nor-Shipping reveals stellar line-up for Ocean Leadership Conference
10:52 10 vessels escorted by icebreakers in eastern part of Gulf of Finland during 24 hours on January 16-17
10:28 NOVATEK’s hydrocarbon production totaled 548.4 million boe in 2018, up 6.9% Y-o-Y
10:03 Brent Crude futures price down 0.34% to $61.11, Light Sweet Crude – down 0.54% to $52.03
09:39 Tallink and Taltech to collaborate on developing smart ship solutions