• 2018 October 11 15:24

    MABUX warns bunker prices may be vulnerable amid the uncertainties on both the supply and demand side

    The Bunker Review is contributed by Marine Bunker Exchange

    World oil indexes rallied last week to their highest level since November 2014 supported by disruptions in the Gulf of Mexico related to Hurricane Michael. However there is downward correction on the market at the moment: API reported a major build of 9.75 million barrels of United States crude oil inventories for the week ending October 5. Anyway there is a number of uncertainties which may cause a state of high vulnerability for the fuel indexes in a short-term. On the supply side, there’s uncertainty about how much Iranian oil the United States will man-age to choke off. Then there’s uncertainty about how much spare capacity Iran’s fellow OPEC members and non-OPEC Russia could summon to replace Iranian losses. Finally, on the demand side, there’s uncertainty whether oil prices at four-year highs and consequently, fuel prices at multiple year highs, are already denting oil demand growth.

    MABUX World Bunker Index (consists of a range of prices for 380 HSFO, 180 HSFO and MGO at the main world hubs), finally demonstrated irregular changes in the period of Oct.04 - Oct.11:
        
    380 HSFO - down from 491.57 to 490.93 USD/MT (-0.64)
    180 HSFO - up from 533.00 to 535.21 USD/MT      (+2.21)
    MGO         - down from 762.36 to 752.71 USD/MT  (-9.65)


    Goldman Sachs said in a note that the oil market could swing into a surplus in early 2019 as spare capacity is deployed. As per Bank, production in Libya and Nigeria was higher than expected, by 300,000 bpd, and coupled with Saudi Arabia’s production ramp-up and the political stabilization of Iraq, which improved prospects for higher output from Kurdistan, it could provide a supply buffer for the final quarter of the year. The investment bank’s warning might not have an immediate effect on prices as traders are at the moment too preoccupied with the worry that OPEC’s spare capacity is at a historic low, but once it sinks in, prices could reverse their climb.

    The U.S. State Department in turn criticized Saudi Arabia for not using its spare capacity. A State Department official said that the U.S. was working with Saudi Arabia to use the spare capacity that they are not deploying, while also insisting that the U.S. was doing its part. The U.S. State Department also said OPEC and non-OPEC producers including Russia continue to withhold production.

    The International Monetary Fund (IMF) lowered its outlook for the global economy, expecting a growth rate of 3.7 percent this year and next, down from the 3.9 percent the Fund expected back in April. The IMF cited the uneven nature of the economic expansion, the increase in the likelihood of negative shocks, and the unsustainable policy support behind much of the growth. Robust economic growth underpins the assumed strong increase in oil demand, so any faltering in the global economy exposes downside risk to oil prices.

    The International Energy Agency (IEA) said that rising oil prices may hurt demand in some of the world’s fastest-growing nations unless producers take steps to boost supplies. India is among emerging market economies struggling with a combination of a weakening currency and rising oil prices. The country, which enjoyed a 12th straight month of demand growth in August, could see its trade deficit worsen because of the high crude. India moved to cut retail fuel prices on Oct.04.

    Meantime, India discussed last week the possibility of trading oil with Russia, Venezuela, and Iran either in Indian rupees or under a barter agreement. The idea to use rupees or a barter system comes as U.S. sanctions on Iran draws near and are just over four weeks away. It was also discussed the possibility of creating a rupee-yuan payment mechanism for trading with China.

    At the same time, Indian buyers reduced U.S. crude purchases and loaded up on Iranian oil ahead of the restart of U.S. sanctions next month. U.S. oil shipments to India fell to 84,000 barrels per day (bpd) last month, down 75 percent from a record high of 347,000 bpd in June. India accounted for 12 percent of U.S. crude exports in June. Meantime, Indian buyers lifted purchases of Iranian crude to 502,000 bpd in September, up 111,000 bpd over August. It was also reported that India has plans to purchase 9 million barrels of oil from Iran in November, contra-ry to earlier reports that led the market to believe India had no plans to do so.

    Iran’s crude oil exports plunged to 1.1 million bpd in the first seven days of October, sliding further down from 1.6 million bpd in September. According to tanker tracking, not a single tanker headed to Europe in the first seven days of October. Iran’s tankers were bound instead for China, India, and the Middle East. Besides, some one dozen Iranian oil tankers may have shut off their position devices last month. As a result, nearly 207,000 bpd of Iran’s oil exports that left Iranian oil terminals last month is reportedly unaccounted for.

    A tanker collision a month ago at a critical Venezuelan port may take longer to repair than initially expected. One of the docks will take probably another month before it can come back online, which will likely lead to steeper oil export losses. Venezuela’s exports fell to just 1.1 million bpd in September.

    A trade war between the United States and China is still a potential catalyst: as it escalates global oil demand is sure to suffer. While China hasn’t officially placed a tariff on U.S. oil, refiners and traders appear to be increasingly wary of purchasing oil from the U.S. – suggesting they believe the tariffs may be on the agenda.

    It was reported a dip of 2 in the oil and gas rig count in the United States last week, bringing the total number of active oil and gas rigs to 1,052 (the number of active oil rigs decreasing by 2 to reach 861). The oil and gas rig count is now 116 up from this time last year.

    The Yemeni Houthi rebels have detained 10 vessels, including fuel tankers, at the port of Hodeidah, and are preventing them from offloading their cargo. The vessels waiting to unload at Hodeidah, and some of them had been held up at the port for as long as six months. The port city is currently a battlefield between the Iran-backed Houthis and the coalition of Saudi and Emirati forces. Yemen’s oil reserves have been estimated at 3 billion barrels. Even before the start of the civil war, the country wasn’t a major oil producer, especially compared to the other countries in the Middle East.

    Persisting uncertainties on both the supply and demand side are making the market and participants nervous. Fuel indexes could be more vulnerable than usual to hints, news, and comments until the U.S. sanctions on Iran return in four weeks. We assume bunker prices may change irregular 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 October 21

08:54 20,000 TEU COSCO SHIPPING Sagittarius named in Shanghai
08:50 CFO Paul Smits leaves the Port of Rotterdam Authority
07:52 COSCO SHIPPING starts shipment of Toyota exhibits

2018 October 20

08:47 Boskalis, Van Hattum en Blankevoort and Mobilis construct deep-sea quay for the new HES Hartel Tank Terminal at Maasvlakte
08:10 Navios Partners announce filing of F - 1 for direct listing of Navios Containers
08:06 Maersk Line increases FAK rates for Northern Europe to Middle East and ISC trade
08:04 U.S. Navy contracts Austal to order materials for EPF 13
07:44 EU Commission launches the European Network of U-space Demonstrators

2018 October 19

18:42 ABN AMRO, Samsung SDS and the Port of Rotterdam Authority launch container logistics blockchain pilot
18:07 Stena Line's battery hybrid vessel completes its first month of operation
17:56 ABN AMRO, Samsung SDS and Port of Rotterdam Authority launch container logistics blockchain pilot
17:35 Port of Gdansk participated in the CILF 2018 fair in China
17:11 Gdansk pays a visit to Singapore
16:57 Testbed established for Internet of Ships Open Platform
16:48 Finland’s Water Transport Act aims to improve safety and increases preparedness for the future
16:26 World’s largest LNG bunker supply vessel “Kairos” started its voyage to Europe
16:04 KN will motivate its employees with the company's shares
15:42 New Falck training centre on the Maasvlakte officially openes
15:20 Seimas members visiting Klaipėda discussed benefits provided by LNG terminal
14:59 Ukraine plans dredging of 16.33 million cbm of material in 2019
14:37 UN agencies delivering on maritime security
14:15 Hapag-Lloyd starts new Red Sea service
14:00 Atomflot: shipments from Arctic LNG and Yamal LNG to be assisted by diesel and gas powered icebreakers
13:31 MOL's newbuilt LNG carrier "MARVEL EAGLE" to transport LNG from Cameron project in U.S.
13:11 NIBULON Shipbuilding and Repair Yard launches POSS-115 Project tug
13:05 BigLift Barentsz sails Northern Sea route for Pioneering Spirit
12:48 Glavgosexpertiza approves reconstruction of KSK grain terminal to increase its capacity to 4 million tonnes
12:22 Q&A with ImageSat International released ahead of SMi’s 4th annual Maritime Reconnaissance and Surveillance Technology conference
12:05 FESCO wins tender for supplying Indian Research Stations in Antarctica in 2019
11:43 Competition for designing and construction of LNG-powered icebreaker to be announced in late 2018 - early 2019
11:20 North Sea Giant turns to The Switch EBL technology
10:54 NOVATEK to place four FLNG facilities on the Northern Sea Route
10:31 RF Navy’s major amphibious ship Ivan Gren enters North Sea
10:07 Port of Vancouver closes 2018 cruise season
09:56 Brent Crude futures price up 0.4% to $79.61, Light Sweet Crude – up 0.35% to $68.89
09:38 Tackling maritime emissions - IMO rolls out ship and port toolkits
09:29 Expert forecasts more favorable ice situation on Northern Sea Route for 30 years ahead
09:15 Baltic Dry Index is up to 1,565 points
09:07 Hapag-Lloyd, CMA-CGM and COSCO enhance GEM service - covering Mediterranean with the Middle East / ISC
08:37 Samskip launches Netherlands-Italy multimodal rail service
08:07 SEA\LNG submits open comment on the draft supplemental environmental impact statement for Puget Sound LNG facility
07:20 Van Oord awarded offshore contract for the West White Rose Project

2018 October 18

18:03 VSDV opens new crossdock location in the port of Amsterdam
17:33 The first vessel in Klaveness Combination Carriers next generation of combination carriers named at New Yangzi Shipyard in China
17:17 Cargo transportation via Northern Sea Route can reach 17 million tonnes in 2018
17:03 Savannah container trade up 12 percent in September 2018
16:55 PGRK: sales strategy of Pavlovskoye deposit project is focused on foreign markets
16:33 SITC Logistics Group signs strategic cooperation agreement with Chengdu Port Investment Group and Guangzhou Port Logistics Group
16:03 NYK and Horiba to develop a new sulfur-in-oil analyzer for ships
15:34 Thames freight volume rises by 40% as Thames Vision strategy starts to bear fruit
15:33 Port of Rotterdam Authority and research institute TNO present results of the study at IMO meeting
15:31 Dublin Port volumes grow by 4.7% in first nine months. By year end, 36% growth in just six years
15:03 Chinese Lingang group invests 85 million euros in Zeebrugge inner port
14:47 Practical aspects of LNG bunkering to be discussed at the dedicated conference in Moscow on October 24
14:33 Nouryon, Tata Steel, and Port of Amsterdam partner to develop the largest green hydrogen cluster in Europe
14:24 Bunker prices may change irregular next week amid rising volatility on global fuel market, expert says
14:11 Tallink and Rauma marine constructions sign letter of intent for the construction of new shuttle ferry
14:02 VesselMan and DNV GL team up to offer optimized solution for dry-docking management
13:30 Project Forward paves the way for meeting IMO’s reduction on CO2 emissions
13:14 Equinor’s share saving plan allocates shares