For the next week expect upward trend to be continued. This forecast is provided to Portnews by Marine Bunker Exchange.
An improving global economy and increasing demand for higher risk assets helped drive crude oil indices higher this week. Although the market looked sluggish at times due to technically overbought conditions and uncertainty over the U.S. debt ceiling issue, the nearby futures contract has been able to hold on to most of its gains.
Petroleum products prices have rallied in recent days on expectations that heavy season refinery maintenance work this quarter will tighten inventories of refined products like gasoline and heating oil. The estimations say that first-quarter maintenance work could cut crude processing by about 9% to 10% of capacity, compared with a 7% in the first quarter of 2008, a period of heavy shutdowns. That would translate to around 1.6 million to 1.7 million barrels a day of crude capacity off line. Meanwhile, in the U.S. new pipelines are helping to bring oil stuck in the middle of the country to refineries on the coast, which is beginning to relieve a supply glut that has depressed U.S. crude prices compared to Europe's Brent crude.
The U.S. is over the fiscal cliff, so oil market is starting to go up on this economic optimism as well. The Federal Reserve on Jan.30 kept its monthly bond-buying plan while indicating a recent stall in U.S. economic growth was likely temporary and predicting the nation's job market would continue to help support the economy. Despite U.S. crude inventories increased by 5.9 million barrels last week, the Energy Department’s data didn’t change the general positive direction of the market.
China's promising economic growth forecast for 2013 has raised expectations for robust demand for fuel from the top energy consumer, while data from the euro zone that show economic sentiment improving more than expected across all sectors in January has also supported oil futures.
More optimism was brought to market participants by OPEC. Secretary-General Abdullah al-Badri said in London, the world oil market should remain well supplied in 2013 and OPEC does not need to trim back its oil output. The group, which supplies about 40 percent of the world’s oil, reduced output by 465,000 barrels a day in December to 30.4 million a day, the lowest level since October 2011. OPEC next meeting is expected on May 31.
Persisting tension in the Middle East and Africa also supported oil. Iran’s launch of a live monkey into space on Jan. 28 has alarmed the West because the technology could potentially be used to deliver a nuclear warhead. Besides, Iran is a key supporter of Syrian President Bashar al-Assad who is fighting a near two-year-long revolt. So the last Israeli warplanes attack on a convoy near Syria's border with Lebanon may turn into the new round of tension in the region. Meanwhile, Egyptian President Mohamed Mursi declared a month-long state of emergency in three cities along the Suez Canal where the total oil traffic reached 2.17 million barrels a day in 2011. The potential disruptions in oil supplies are still one of the most important supportive factors for the world oil market.
Overall, we don't think there's much downside risk for oil prices as global economic data has improved. Market is waiting for key U.S. nonfarm payrolls data on Feb. 01 and official manufacturing data out of China that is expected to show factory activity picking up pace.
|
Product |
380 cSt HSFO |
380 cSt LSFO |
|
|
|
|
|
Rotterdam 2013-01-31 |
625 |
658 |
|
Rotterdam 2012-01-31 |
666 |
680 |
|
|
|
|
|
Gibraltar 2013-01-31 |
640 |
695 |
|
Gibraltar 2012-01-31 |
693 |
745 |
|
|
|
|
|
St Petersburg 2013-01-31 |
525 |
585 |
|
St Petersburg 2012-01-31 |
400 |
490 |
|
|
|
|
|
Panama Canal 2013-01-24 |
650 |
755 |
|
Panama Canal 2012-01-24 |
690 |
- |
|
|
|
|
|
Busan 2013-01-31 |
663 |
838 |
|
Busan 2012-01-31 |
744 |
- |
|
|
|
|
|
Fujairah 2013-01-31 |
635 |
745 |
|
Fujairah 2012-01-31 |
720 |
- |
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)
|
Product |
Close Jan.30 |
|
Light Crude Oil (WTI) |
$97.94 |
|
Brent Crude Oil |
$114.90 |