• 2018 June 7 15:39

    MABUX: State of high volatility will retain on global fuel market

    The Bunker Review is contributed by Marine Bunker Exchange

    World oil indexes have continued firm downward trend during the week. The main factor was news that OPEC and its partners, including Russia, are considering a loosening of their production limits. Additional pressure was added by a report that the U.S. government had asked Saudi Arabia and other major exporters to increase oil output. The spread between the two benchmarks (Brent and WTI) is rare, and reflects uncertainty and confusion in the global fuel market, as well as regional differences in supply and demand.

    MABUX World Bunker Index (consists of a range of prices for 380 HSFO, 180 HSFO and MGO at the main world hubs) also demonstrated downward trend in the period of May.31 – June 07:

    380 HSFO - down from 435.14 to 431,29 USD/MT (-3.85)
    180 HSFO - down from 477.07 to 472,07 USD/MT (-5.00)
    MGO        - down from 692.57 to 674.29 USD/MT (-18.28)

    WTI dropped to a more than $10-per-barrel discount to Brent this week, the widest spread in three years. The pipeline bottlenecks in the Permian are starting to bite. U.S. ex-ports of crude are rising, while Brent-linked cargoes in the Atlantic Basin are struggling to find buyers.

    The U.S. government has asked Saudi Arabia and some other OPEC producers to increase oil production by about 1 million barrels per day (bpd). The request comes after U.S. retail gasoline prices surged to their highest in more than three years and President Donald Trump publicly complained about OPEC policy and rising oil prices. It also follows Washington’s decision to reimpose sanctions on Iran’s crude exports that had previously displaced about 1 million bpd from global markets. The request for extra oil are among the most forceful U.S. intervention in OPEC affairs since Bill Richardson (the energy secretary during the second administration of Bill Clinton, phoned the Saudi minister in the middle of an OPEC meeting in 2000 asking for a production increase). That time the intervention aggravated a dissent between Saudi Arabia and Iran.

    Meantime, Saudi Arabia and Russia committed to ramping up production to as much as 1 million barrels per day before the production cut deal ends at the end of this year, should it be-come a necessary step to meet demand with Venezuela’s falling production and Iran’s possible production or export shortfalls in the wake of US sanctions against it. Oil prices took another blow with Rosneft unexpectedly increasing production by 70,000 bpd. Iran and Kuwait are leading a faction within OPEC accusing Saudi Arabia of capitulating to U.S. and Russian pressure to drive the price of oil down. OPEC meets formally on June 22 to set oil policy. It is expected to agree to raise output.

    Venezuela’s production declined to 1.45 million bpd from 1.50 million bpd in May, compared to the implied target of 1.972 million bpd, which means that Venezuela’s involuntary cut in May was 617,000 bpd-more than the cut pledged. Besides, country is struggling to meet its supply obligations, with dozens of tankers waiting to take on its oil. The back-log is so severe that state-owned PDVSA has told some customers it may declare force majeure.

    Over the past few weeks, Iran has repeatedly sought EU support to offset renewed U.S. sanctions. Tehran wants the EU to help safeguard its oil export revenues, its most important source of income, by enlisting the help of European central banks. Consequently, the EU has been considering bypassing the U.S. financial system by handling oil purchases from Iran in euros in-stead of U.S. dollars.

    The consequences of the U.S. withdrawal from the Iran nuclear deal, the possible Irani-an response, and the actual physical barrels of oil that could be taken off the market are still very much an important factor for fuel prices. One of the most drastic reactions from Iran could be Tehran pulling out of the 1968 Treaty on the Non-Proliferation of Nuclear Weapons (NPT) (a treaty in which 93 countries, including Iran, have vowed never to obtain nuclear weapons).

    President Trump resumed trade war last week, slapping steel and aluminium tariffs on Canada, Mexico and the EU and industrial tariffs on China. The decision comes after offering exemptions to U.S. trading partners in recent months, and comments from the Treasury Secretary just two weeks ago that the trade war would be put on hold. The resumption of a trade war threatens to undermine demand, although the magnitude of the slowdown is hard to predict.

    US oil production is also pressing down on fuel prices, and for the week ending June 01, reach-ing 10.8 million bpd—the fifteenth build in as many weeks. US production continues to climb at a time when OPEC is obliged to a supply cut deal. When the deal was announced, the United States was producing 8.6 million bpd. Today, the US is producing more than 2.0 million bpd over that figure. US drillers also added 2 rigs to the number of oil rigs last week. The oil and gas rig count now stands at 1,060—up 144 from this time last year.

    The shipping industry is going to scrap the largest number of oil tankers this year in over a half-decade. The pace of scrapping comes after years of overcapacity and low rates, with the OPEC cuts also hurting demand for shipping. It is expected, that the poor market conditions will last until next year, but the removal of excess capacity will help.

    The market doesn’t know at the moment where the price of oil/fuel is going to be and probably doesn’t know where it should be, and so it’s open to some major price fluctuations. We expect a state of high volatility will retain on global fuel market. Bunker prices may continue slight downward trend 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)




2018 August 16

14:33 CMA CGM announces GRR from Asia to Indian Ocean
14:27 MABUX: Bunker prices may change irregular next week
14:13 Maersk Line announces rates from Far East to North Europe
13:42 First ever S-T-S loading of 70000dwt Panamax coal carrier performed at Shakhtersk harbour transshipment location in Sakhalin
13:32 More investment contracts at the Port of Gdansk
13:02 Wärtsilä equipped Canadian ferry will have minimal environmental impact
12:16 Damen Shipyards Galati celebrates 125 years
12:09 Okskaya Sudoverf Shipyard launches 6th serial barge of Project ROB20
12:03 Boskalis presents half-year results and terminates loss-making low-end transport activities
11:59 Port of Oakland container volume up 3.6 percent in July 2018
11:45 Rolls-Royce launches new battery system for ships
10:58 DP World revenue up 14.4% in H1 2018
10:57 VARD secures contract for one autonomous and electric-driven container vessel for YARA
09:39 EU NAVFOR mission operation commander visits Spanish MPRA in Djibouti
09:21 Baltic Dry Index gains to 1725 points

2018 August 15

18:33 Equinor extends partnership with The Arctic Race of Norway
17:56 Port Kavkaz seven-month volumes soar 30% Y/Y to 25.21 million tonnes
17:36 Russian Gov't to allocate RUB 500 million in subsidies to support small-tonnage fishing ships construction, Rosrybolovstvo says
17:34 Maersk Line to rise rates from Far East to East Coast South America
17:30 Yang Ming orders ten 2,800 TEU containerships
17:19 Nor-Shipping 2019 takes place in Oslo and Lillestrøm, Norway, from 04 to 07 June 2019
16:05 New Times Shipbuilding announces delivery of oil tanker
15:04 Rosrybolovstvo looks into building a series of three RVs as from 2020
15:04 Concordia Maritime AB announces interim report for H1 2018
14:12 Multipurpose Reloading Complex spends over RUB 600,000 on employee benefits and rewards programme
13:20 Konecranes to deliver more electric RTGs to Luka Koper in Slovenia
13:02 Join Marinet Conference at SMM 2018, Hamburg
12:32 Prime Minister Dmitry Medvedev gives green light to NLR construction project
12:01 WW Ocean presents new-look trade maps resembling public transit maps
11:15 Port of Vancouver posts H1 2018 results
10:41 Aker Solutions wins orders for Liuhua power umbilical systems in China
10:21 Nor-Shipping 2019 devotes entire hall to new focus on Blue Economy
10:05 Crude oil futures drop 0.22% to $72.3 in London and 0.48% to $66.72 in New York
09:29 Bunker prices at Port of St. Petersburg show mixed movements

2018 August 14

18:30 Hapag-Lloyd annonces General Rate Increase from East Asia to USA and Canada
18:12 FE Railways' loaded freight in Jan-Jul up 2% to 28.2 million tonnes
18:07 Hapag-Lloyd changes terminals at Genoa on its MPS service
17:47 British Ports Association launch Sustainable Development Resolution
17:45 Euro Tank Terminal extends jetty at the port of Rotterdam
17:31 MEYER WERFT holds float out procedure for cruise ship for AIDA Cruises
17:29 APM Terminals launches online customer platform in Bahrain
17:27 MED MARINE delivers a 24m ASD Tug from Turkey to Estonia
16:24 Offshore installation vessel starts work on Belgium’s largest offshore wind farm
15:44 Logistec Corporation declares quarterly drvidends on shares
15:21 Vessel Performance Optimisation Forum Singapore initial speakers announced
15:02 Danaos Corporation announces closing of comprehensive debt refinancing
14:16 Sea Port St. Petersburg earmarked over $337,000 for bonus and social responsibility programmes
14:13 TTS Group ASA secures new contracts for access equipment and cranes for two reefer vessels
14:06 Ports of Primorsk and Ust-Luga support green shipping, to implement incentives for LNG-powered ships as from August 15, 2018
13:39 Bunker prices in Far East seaports edge down
13:14 ExxonMobil is first to supply via an independently accredited MFMS in ARA
13:10 Port of Brisbane announce a successful bid for funding of Heavy Vehicle Safety Around Ports project
12:13 HHLA posts operating result for H1 2018
11:29 Rosterminalugol’s seven-month coal throughput hits the 13-million tonne mark
11:11 Crude oil futures price rises to $73.28 (London) and $67.81 (New York)
11:01 Diana Shipping announces continuation of time charter contract for m/v Protefs and a new time charter contract for m/v Nirefs with Hudson
10:58 GeoSea has taken delivery of self-propelled DP2 jack-up vessel ‘Apollo’
10:09 Safe Bulkers announces acquisition of a Capesize class dry-bulk vessel
09:30 Consolidated Marine Management selects ABS Advanced Solutions Enterprise Asset Management
09:14 Baltic Dry Index gains 18 points edging up to 1800pts mark