• 2018 December 6 16:01

    MABUX: Big chance for bunker prices to turn into firm upward evolution again

    The Bunker Review is contributed by Marine Bunker Exchange
     
    November was the worst month for oil indexes in a decade due to fears of oversupply and slowing demand growth. However in the beginning of the week oil and fuel prices have turned into firm upward evolution as growing expectations that major producers, led by Saudi Arabia and Russia, will agree some form of production cut at a key meeting of OPEC ministers on Dec. 06-07 boosted sentiment.

    MABUX World Bunker Index (consists of a range of prices for 380 HSFO, 180 HSFO and MGO at the main world hubs), finally have followed general trend on global oil market and also have risen in the period of Nov.30 – Dec.06:
        
    380 HSFO - up from 383.93 to 394.36 USD/MT (+10.43)
    180 HSFO - up from 432.71 to 444.21 USD/MT (+11.50)
    MGO         - up from 605.64 to 612.50 USD/MT  (+6.86)


    The Organization of the Petroleum Exporting Countries meets on Dec.06 in Vienna to agree output policy and will discuss its strategy with producers outside OPEC, including Russia. OPEC and its allies are working towards a deal to reduce output by at least 1.3 million barrels per day (bpd) and they were still talking to Russia about the extent of its production cuts. How-ever Saudi Oil Minister Khalid Al-Falih said it was too soon to be certain that OPEC and other oil exporters would cut production because the terms of a deal remain unresolved.

    Helping OPEC in its efforts to rein in emerging oversupply was an order on Dec.02 by the Canadian province of Alberta for producers to scale back output by 325,000 bpd until excess crude in storage is reduced.

    Saudi Arabia is aiming to cut oil production in order to boost prices, but the recent vote by the U.S. Senate to end the war in Yemen, even if it doesn’t become law, heightens the pressure on Riyadh. That gives President Trump more leverage as he demands lower oil prices from Saudi officials. Saudi Arabia faces a choice between accepting painfully low oil prices or defying Washington by cutting production.

    Russia has started to concede that it needs to join a fresh Saudi-led oil production cut, but is still discussing with its key partners in OPEC over how much, how fast, and for how long it would potentially reduce its oil output. Meantime, Russia’s energy ministry is discussing potential oil production cuts with local producers. Most experts agreed that Russia can’t immediately reduce production and if it joins the cuts, it will cut output gradually, like it did the previous time.

    At the same time, the November data showed Russia’s oil production had fallen to 11.369 mil-lion barrels per day, an almost half a percentage decline from the record highs Russia kicked out in October of 11.41 million bpd. Production had previously been steadily increasing for months as Saudi Arabia and Russia attempted to lift production to make up for Iranian losses that most expected from the U.S. sanctions. The slip in production for November is not seen as a deliberate attempt to curb production to balance the market, but more as the natural consequence of issues with specific oilfields, and possibly from seasonality.

    A proposed U.S. legislation that could establish the way for suing OPEC for market manipulation is a big concern among the cartel. Such legislation would make OPEC subject to antitrust laws by removing a state immunity shield created by judicial precedent. Given U.S. President Donald Trump’s continued criticism of OPEC and the way the cartel manipulates the oil market and prices, OPEC members are concerned that the legislation may pass this time around. OPEC is also said to have urged all its members not to mention specific oil prices, and to instead stick to the market stability narrative in public comments about oil policies to avoid the risk of potential U.S. antitrust lawsuits for manipulating the market.

    Qatar is withdrawing from the OPEC as of January 2019. The decision came after Qatar, one of OPEC's smallest producers but the world's largest liquefied natural gas exporter, reviewed ways to enhance its role internationally and plan long-term strategy, including focusing on its gas industry. Doha is an influential player in the global LNG market with annual production of 77 million tonnes per year, based on its huge reserves of the fuel in the Gulf. It was also reported that the decision was not linked to a political and economic boycott of Qatar imposed since June 2017 by OPEC's de facto leader Saudi Arabia and three other Arab states.

    Iran said that the United States will not be able to stop Iran exporting its oil and any move to prevent Iranian crude shipments passing through the Gulf would lead to all oil exports through the waterway being blocked. Iran also warned the European Union that it could exit the 2015 nuclear deal if it does not begin to see some of the benefits from European efforts to rescue the accord. The United States has imposed sanctions on Iran and U.S. officials say they aim to reduce Iran's oil exports to zero in a bid to curb the Islamic Republic's missile program and regional influence.

    The Trump-Xi negotiations in Argentina G20 meeting had a favourable effect on prices. The U.S. will still keep in place $200 billion of tariffs on Chinese imports but will not increase those tariffs from 10 percent to 25 percent after the start of the year as originally planned. The deal will also keep, at least for now, Trump from placing another $267 billion worth of Chinese goods under tariffs. Washington and Beijing said they will try to achieve a permanent deal with-in the next 90 days. China, for its part, also agreed to offset its massive trade imbalance with the U.S. by buying more, but not yet specified amounts, of energy products, agricultural, industrial and other products. However the U.S. still has significant leverage: if a formal deal can’t be reached then it will hike tariffs to 25 percent, which could roil global stock markets, stagnate global economic growth, dampen oil demand growth and possibly lead to a recession across the globe, particularly in emerging economies.

    US production for the week ending November 30 continues to weigh on prices, averaging 11.7 million bpd for the third week in a row and the highest production rate for the United States. It was also reported a 3-rig decrease for oil and gas in the United States last week. The total number of active oil and gas drilling rigs now stands at 1,076, with the number of active oil rigs in-creasing by 2 to reach 887. The oil and gas rig count is now 147 up from this time last year, 138 of which is in oil rigs.

    A major catalyst for fuel prices to rebound from current levels could be the OPEC/non-OPEC meeting on December 6-7, at which the cartel and allies may announce a fresh production cut to stop the price decline, and to stabilize markets. We expect new production cut will be finally fixed so that bunker prices will have a chance to continue upward evolution.

     

     

     

     

     

     

     

    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)




2019 June 27

15:47 Murmansk Commercial Seaport increased daily unloading by 12% to 858 railcars
15:19 Gasum partners with new customer in LNG deliveries from Manga LNG Terminal in Tornio, Finland
14:53 Shanghai, China to host Intermodal Asia 2020 on March 17-19
14:28 Hamburg Messe to host Intermodal Europe 2019 on November 5-7
14:05 CMA CGM announces FAK rates from the Mediterranean to Mexico East Coast
13:51 GTT receives an order from Jiangnan Shipyard for the design of 5 container ships’ LNG fuel tanks
13:16 Sovcomflot participates in Marine Money Week 2019
12:44 Mediation starts at National Mediator’s office between Norwegian Shipowners’ Association, Industri Energi and SAFE
12:22 WMU-Koji Sekimizu PhD Fellowship on Maritime Governance launched officially
12:00 CMA CGM announces FAK rates from the Mediterranean to USEC and USGULF
11:38 Equinor and OMV sign two MoU to cooperate in the Barents Sea and in the Norwegian Sea
11:17 Singapore to host International Chemical and Oil Pollution Conference and Exhibition (ICOPCE) on 21-24 October 2019
10:56 Vympel Shipyard launched hydrographic survey vessel of Project 19910, Nikolay Skosyrev, built for RF Navy
10:35 Equinor signs sand screen services contracts with Tendeka AS and Baker Hughes Norge AS
10:13 Gasum’s Coralius reaches bunkering milestone in Rotterdam bunkering ship-to-ship
09:51 Brent Crude futures price is down 0.46% to $65.39, Light Sweet Crude – fell by 0.49% to $59.09
09:35 MABUX: Bunker Market this morning, June 27
09:32 Neptune Energy confirmes its development plans for the Duva and Gjøa P1 projects in the North Sea
09:17 Baltic Dry Index is up to 1,317 points
08:22 Colombo Dockyard delivers cable laying vessel built for Kokusai Cable Ship

2019 June 26

18:31 Dolphin Drilling business completes financial restructuring and appoints new management team
18:11 Jacobs wins contract to help build the largest shipyard in the Arabian Gulf
18:09 Senior officials from Kenya Coast Guard Services are undergoing training at national workshop in Mombasa
17:52 LUKOIL commissions two wells at V. Filanovsky field
17:30 Term of office of Sergey Baryshnikov, Rector of Makarov University, extended for 5 years
17:06 Saudi Aramco signs 12 agreements with South Korean partners worth billions of dollars
16:41 Damen Shiprepair Amsterdam completes major maintenance programme on OSV Deep Arctic
16:23 Nordic Engineering wins competition on development of technical design for 6-8 MW icebreaker
15:49 50 Let Pobedy icebreaker returned to Murmansk after its 50th voyage to North Pole
15:35 OOCL chooses Navis Stowage Planning Software StowMan for its container ship fleet
14:52 MacGregor works together with MSC to maximise performance and reduce emissions
14:50 IMO celebrates 30 years of outstanding legal training
14:26 North Sea Port conducts quay-inspection test using underwater robot from Asset.Insight.
14:03 Damen Shiprepair & Conversion signs contract on the conversion of a dredger ‘Samuel de Champlain’
13:52 EU NAVFOR Somalia takes part in Ministerial Conference on Maritime Security in Western Indian Ocean and Plenary Session of CGPCS
13:24 Sergey Larionov elected as General Director of Lena United River Shipping Company
12:51 Igor Tonkovidov elected as Chairman of Novoship BoD
12:27 Port of Rotterdam Authority to invest over 3.5 million euros to optimise the Wilhelminahaven
12:00 Nevsky Shipyard certified in “Military Register” Voluntary Certification System
11:58 Closing of MacGregor's TTS acquisition postponed to Q3 2019
11:35 Russia's Main Department of State Expertise approved project on development of bunkering base at commercial seaport of Murmansk
10:57 Yamal LNG shipped first LNG cargo to Japan
10:18 Brent Crude futures price is up 1.42% to $65.19, Light Sweet Crude – up 1.94% to $58.95
09:59 IAPH South East Asia and Oceania Region meets in Kuala Lumpur in August
09:44 MABUX: Bunker Market this morning June, 26
09:33 Bunker prices increase at the port of Saint-Petersburg, Russia (graph)
09:14 Baltic Dry Index is up to 1,280 points

2019 June 25

18:06 VARD orders seawater cooling for newbuild cable layer
17:34 ABP Humber Estuary Services (HES) purchased new £600,000 survey vessel
17:06 Q-Flex vessel sets delivery benchmark in Turkey
16:28 Awilco LNG posts vessel and contract update
16:22 Zhatai Shipyard to be provided with RUB 4.1 billion of budget investments in 2019–2021
15:59 Maersk introduces Maersk Spot, a new fully online product that simplifies the buying process for customers
15:15 NCSP Group announced decisions made at annual general shareholders' meeting
14:51 IMO: committed to implementation
14:20 ABP King’s Lynn investment attracts new construction industry customer
13:37 MAN B&W dual-fuel engines pass half-million hour milestone
12:59 ECSA celebrates the Day of the Seafarer
12:47 Bunker market sees mixed price movements at the Far East ports of Russia (graph)
11:58 Fuel technologies in the spotlight at ABS Hellenic Technical Committee