MABUX: Bunker market this morning, Nov 24
The Bunker Review was contributed by Marine Bunker Exchange (MABUX)
MABUX World Bunker Index (consists of a range of prices for 380 HSFO, VLSFO and MGO Gasoil) in the main world hubs) continued to rise on Nov.23:
380 HSFO: USD/MT 316.24 (+3.78)
VLSFO: USD/MT 374.00 (+3.00)
MGO: USD/MT 440.30 (+2.72)
Meantime, world oil indexes increased on Nov.23 on a sustained burst of optimism that the distribution of vaccines to treat Covid-19 will enable a thorough recovery in oil demand next year.
Brent for January settlement increased by $1.10 to $46.06 a barrel on the London-based ICE Futures Europe exchange. West Texas Intermediate for January rose by $0.64 to $43.06 a barrel on the New York Mercantile Exchange. The Brent benchmark traded at the premium of $3.00 to WTI. Gasoil for December delivery added $10.750.
Today oil indexes continue to rise as news of a third promising coronavirus vaccine candidate spurred hopes of a quicker recovery in oil demand, while U.S. President-elect Joe Biden received the go-ahead to begin his leadership transition.
Three separate biotech companies have now announced that their vaccines are effective in preventing at least 90% of Covid-19 cases. The drug developed by latest company to announce its results, AstraZeneca, accounts for around 40% of preliminary sales of vaccines to lower and middle-income countries, and should ensure that an effective vaccine is distributed broadly across global markets. AstraZeneca said on Nov.23 its COVID-19 vaccine was 70% effective in pivotal trials and could be up to 90% effective, giving the world's fight against the global pandemic a third new weapon that can be cheaper to make, easier to distribute and faster to scale-up than rivals. This follows positive trial results from Pfizer/BioNTech and Moderna.
Optimism for 2021 still has to look through the short-term problems of demand, however. The U.S. continues to report extremely elevated levels of new infections and record numbers of people admitted to hospital with the coronavirus. States and municipalities in the U.S. continue to restrict social gatherings (Nevada Governor Steve Sisolak tightening the screws on casinos in Las Vegas over the weekend). However, there are first signs from Europe that the recent wave of lockdowns is about to get relaxed. France on Nov.20 and the U.K. on Nov.23 both announced plans to relax restrictions ahead of the Christmas shopping season which has acute economic significance.
At the same time, U.S. President Donald Trump on Monday allowed officials to proceed with a transition to Joe Biden's incoming administration, giving his rival access to briefings and funding even as he vowed to persist with efforts to fight the election results.
U.S. crude oil inventories likely edged lower last week, while distillate stockpiles were seen decreasing for a 10th straight week, a preliminary Reuters poll showed on Nov.23, ahead of reports from the American Petroleum Institute and the Energy Information Administration (EIA).
An attack on a Saudi Arabian oil distribution center by Houthi rebels based in Yemen also gave some support to oil indexes. The news briefly triggered memories of the much more disruptive attack last year on pipeline facilities at Abqaiq. However, the substance of Monday’s incident was hardly comparable.
The market is also focused on a week of technical meetings by OPEC and its allies to prepare the ground for next week's ministerial gathering, which is set to discuss extending oil output curbs into next year due to weak demand amid a second wave of COVID-19.
We expect bunker prices may rise today: 4-6 USD up for IFO and 7-10 USD up for MGO.
