• 2018 September 6 15:51

    Bunker prices may continue moderate upward trend next week, expert says

    The Bunker Review is contributed by Marine Bunker Exchange
     
    World oil indexes have climbed 10 percent in the past two weeks but turned into slight down-ward trend yesterday. The global oil market is now two months away from seeing substantial supply losses from Iran due to sanctions. Indeed, the declines are already underway, raising concerns about market tightness.

    MABUX World Bunker Index (consists of a range of prices for 380 HSFO, 180 HSFO and MGO at the main world hubs), changed insignificant and irregular in the period of Aug.30 – Sep.06:
        
    380 HSFO - down from 443.07 to 439.29 USD/MT (-3.78)
    180 HSFO - down from 492.57 to 487.43 USD/MT (-5.14)
    MGO        - up from 699.36 to 709.29 USD/MT     (+9.93)

    OPEC oil output has risen last month to a 2018 high as Libyan production recovered and Iraq's southern exports hit a record. Cartel has pumped 32.79 million barrels per day in August, up 220,000 bpd from July's revised level and the highest this year. Even so, OPEC's adherence with supply targets has actually risen to 120 percent in August from a revised 117 percent in July, because extra barrels from Saudi and others did not fully offset losses in Iran and declining output in Venezuela and Angola.  

    The biggest increase in supplies last month has come from Libya, whose output remains volatile due to unrest. Production at the Sharara oilfield, the country's largest, increased after the restart of a control station that had been closed due to the kidnapping of two workers, and other fields also pumped more.  The second-largest increase came from Iraq, where southern exports reached a record high. Shipments also increased from the north, leaving Iraq as OPEC's least compliant member in August.

    Among countries with lower output, the biggest drop of 150,000 bpd was in Iran. Exports fell as returning U.S. sanctions discouraged companies from buying the country's oil. Production also slipped in Venezuela, where the oil industry is starved of funds because of economic crisis, and in Angola due to natural decline at oilfields.

    Meantime, OPEC and non-OPEC countries are considering ways to formalize their cooperation later this year, eyeing a charter that would extend their coordination on stabilizing the oil market. Under the charter, ministers would meet once a year and technical experts would meet twice a year. The coalition would meet in Vienna and would be hosted by OPEC, but would remain a separate entity.

    U.S. President Donald Trump threatened to withdraw from the World Trade Organization – another step in a deepening dispute between the United States and its major trading partners. Such a move would undermine one of the foundations of the global trading system, which the United States was instrumental in creating. Markets are worried that rising trade barriers between the world’s major economies will drag on global growth and, by extension, erode energy demand.

    The International Atomic Energy Agency (IAEA) said last week that Iran has continued to comply with the terms of the 2015 nuclear deal, despite the withdrawal of the U.S. from the accord. The IAEA said Iran was honouring its commitments to the deal – specifically, to limit stockpiles of nuclear materials and to grant access to IAEA inspectors. There were no areas in which Iran breached the deal.

    Nevertheless, U.S. sanctions on Iran's energy sector will come into force on Nov. 4, although the country's crude oil and condensate exports are already expected to have fallen to a 16-month low in August. The United States wants to force buyers of Iranian oil to cut their imports from OPEC's third-largest producer to nothing, after an international nuclear deal between the two nations was dissolved. There is a concern that Asian importers' demand for crude oil declines.

    Venezuela’s state oil firm PDVSA has said that it signed a US$430 million joint service agreement with seven companies that would help it increase its crude oil production by 641,000 bar-els per day. This is not the first time that Venezuela has claimed it has plans to boost its production. Meantime, Venezuela’s oil production in July dropped to below the 1.3-million-bpd mark—at 1.278 million bpd, plunging 47,700 bpd from June. This compares with an average of 2.154 million bpd in 2016, and an average of 1.911 million bpd in 2017. Besides, a Greek-flagged ship carrying naphtha collided last week with the terminal run by PDVSA, which could reduce capacity of the terminal by up to 425,000 bpd in September.

    The Trump administration is considering moving forward with the proposed $200 billion in tariffs on China when the public comment period ended on September 6. The move would be a significant escalation of the trade war and present a serious downside risk to the global economy and to China’s oil demand. Retaliatory tariffs would be expected, with U.S. exports of crude oil and LNG likely on the target list.

    Despite reports last week that suggested that U.S. oil production fell in June, the EIA said that output rose by 231,000 bpd in June compared to a month earlier. Production stood at 10.674 million barrels per day, dispelling fears that U.S. shale output was grinding to a halt because of pipeline problems. It was also reported a 4-rig increase to the number of active oil and gas rigs (2+2) in the United States last week. The oil and gas rig count is now 105 up from this time last year.

    It has been estimated that the new IMO rules will apply to 3.5 million barrels per day of high-sulfur fuel oil, although post combustion gas scrubbers may allow some vessels to continue using the high-sulfur fuel. Most marine vessels will have to switch to cleaner distillate fuels like low-sulfur diesel, which will increase demand significantly. Besides, the new regulations will increase the cost to produce marine fuel, and it will again put upward pressure on the price of sweet crudes and downward pressure on sour crudes. It is also possible that there will be insufficient supplies when the new specifications come into effect, and that diesel prices are set to rise.

    We expect bunker prices will continue moderate upward 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)




2020 July 9

19:03 OOCL receives Gold Award from the HKAEE for the fourth time
18:10 Aquila Power Catamarans announce a luxuriously versatile new model
17:55 Tallink Grupp’s vessel Sailor to operate on Paldiski-Kapellskär Route from Sunday
17:31 Bunker prices are flat at the Far East ports of Russia (graph)
17:28 Port of Rotterdam to start trial with PIN-free container handling
17:18 Damen holds keel-laying for Port of Auckland’s fully electric RSD-E Tug 2513
17:12 Diana Shipping announces time charter contract for m/v Selina with ST Shipping
16:44 "K" Line participates in JV for FPSO owning and chartering business offshore Brazil
16:23 Jan De Nul Group has started offshore installation activities in Taiwan
16:06 Port of Liepaja throughput in 6M’2020 fell by 15.6% Y-o-Y
15:48 Russia remains in Paris MOU’s White List
15:24 PD Ports submit response to national Freeport consultation
15:03 Khabarovsk Territory Governor Sergey Furgal detained by officials of Russia’s Investigative Committee
14:39 Aibel awarded Oseberg portfolio agreement
13:47 Ukraine is still on Paris MOU’s Black List
13:22 MOL announces joint development of energy-saving rudder
12:50 Container shipments on Russian Railways’ network up 15% in 1H 2020
12:17 Cargo transhipment in North Sea Port falls by more than 11% in first half of year
12:07 ABB teams up with Yinson on offshore oil and gas project in Brazil
11:20 FPSO operators could save £15 million per asset on maintenance
10:42 The CMA CGM Group commits to fight illicit trafficking in protected species and tightens its shipment control procedures
10:10 Unifeeder contracts We4Sea for fleetwide vessel performance monitoring
09:38 MABUX: Bunker market this morning, July 09
09:29 Oil market sees mixed price movements
09:13 Baltic Dry Index as of July 8

2020 July 8

18:11 Carnival Cruise Line sets ship delivery changes and related deployment plans
17:50 POWERGLOBE seeks for 10 years LNG vessel charter-agreement
17:27 Maritime partners unveil Autonomous Guard Vessel
17:03 THE Alliance announces COVID-19 response measures for August 2020
16:48 SaR operation in Singapore: man overboard incident
16:20 Throughput of Rostov-on-Don port in 6M’2020 grew by 10% Y-o-Y
16:13 Maritime industry calls for EU political leadership on seafarers
15:23 Port of Antwerp total throughput down by 4.9% in H1 2020
14:03 Wärtsilä introduces the system, designed to reliquefy boil-off gas onboard gas carriers and LNG bunker vessels
13:45 RF State Duna adopts a package of laws on privileges in the Arctic
13:12 PD Ports wins major pipeline contract with Global Manufacturer at Hartlepool
12:44 DCSA publishes standards for digital exchange of operational vessel schedules
12:18 Germany takes over HELCOM chairmanship
12:11 Seanergy Maritime announces agreement to acquire a Capesize vessel with prompt delivery
11:55 Russian Fishery Company fleet renewal to reduce carbon footprint by 50%
11:29 Pella Shipyard delivers patrol boat of Project 03160
11:04 Austal delivers first of two 118 metre trimarans to Fred. Olsen Express
10:43 Barcelona Cruise Port obtains the 'Safe Travels' Stamp, as safe infrastructures preventing COVID-19
10:32 Throughput of Rosterminalugol in HI’2020 grew by 10% YoY
10:04 ESPO says EU Taxonomy should align with already defined sectoral sustainability criteria
09:40 Oil prices continue decreasing
09:37 MABUX: Bunker market this morning, July 08
09:23 Bunker prices rose at the Port of Saint-Petersburg, Russia (graph)
09:08 Baltic Dry Index as of July 7

2020 July 7

18:06 ZIM unveils new digital services
17:49 Great Arctic Regatta started in Saint Petersburg
17:27 Crude exports via Kozmino in HI’2020 grew by 5% YoY
17:02 Deepsea Atlantic drilling rig returning to Johan Sverdrup
16:35 Optimarin successfully completes IMO G8 and USCG test programme
16:12 Alfa Laval takes its service offer to the next level through remote service guidance
15:56 New ferry line Baltic Link launched at the port of Riga
15:28 RF Government allocates RUB 320 million to subsidize shipping companies
15:02 ABP delivers project cargo using North Lincolnshire’s waterways
14:32 Air Liquide and the Port of Rotterdam Authority launch initiative for hydrogen road transport
14:02 Konecranes to deliver mobile harbor crane to new terminal in Trieste