MABUX: Bunker Market this morning, June 19
The Bunker Review was contributed by Marine Bunker Exchange
MABUX World Bunker Index (consists of a range of prices for 380 HSFO, 180 HSFO and MGO (Gasoil) in the main world hubs) declined on June. 18
380 HSFO - USD/MT 381.82 (-2.07)
180 HSFO - USD/MT 422.74 (-1.32)
MGO - USD/MT 635.75 (-2.44)
Meantime, world oil indexes demonstrated upward changes on June 18
Brent for August settlement increased by $1.20 to $62.14 a barrel on the London-based ICE Futures Europe exchange. West Texas Intermediate for July delivery rose by $1.97 to $53.90 a barrel on the New York Mercantile Exchange. The Brent benchmark traded at the premium of 8.24 to WTI. Gasoil for July delivery increased by $4.50.
Today indexes continue to rise as OPEC edges closer to agreeing on meeting date
OPEC and non-OPEC states are discussing holding meetings on July 10-12 in Vienna, a date range proposed by Iran. OPEC itself, however, is considering meeting on July 1-2 though it is still saying meeting will be held on June 25-26 on its website.
Meanwhile, reports that China and the U.S. would resume trade talks after a stalemate were also cited as supportive for the markets. President Donald Trump said he would hold an extensive meeting with Chinese President Xi Jinping at the G20 summit later this month. The Chinese side has not confirmed a meeting would take place. Chinese state media said Xi agreed to the meeting and emphasized in the call that economic and trade disputes should be solved through dialogue. The U.S.-China trade war has been one of the biggest negatives for oil this year, threatening the global economy with recession and reduced demand for energy. .
Fears of a confrontation between Iran and the United States have mounted since the last week oil tanker attacks, which Washington has blamed on Tehran. Iran has denied involvement. Trump said he was prepared to take military action to stop Tehran having a nuclear bomb but left open whether he would sanction the use of force to protect Gulf oil supplies. Iran on June,17 said it would breach internationally agreed curbs on its stock of low-enriched uranium within 10 days, adding that European nations still had time to save a landmark nuclear deal.
Expectations that the Federal Reserve was working on a rate cut to safeguard the U.S. economy from recession also bolstered sentiment.
Oil prices received additional support from European Central Bank President Mario Draghi's vow to cut interest rates if necessary to support the European economy and reports that Saudi Arabia has been putting new pressure on fellow OPEC members and allies to extend their agreement on output restraint.
Looking ahead, market’s attention will turn to the weekly crude inventories report from the government's Energy Information Administration, which is due later in the day. It is expected that dataset due on Wednesday could show the first strong drawdowns in crude since early May. U.S. crude inventories likely fell by 2.03 million barrels during the week ended June 14, offsetting almost all of the 2.21 million-barrel build seen in the previous week.
According to American Petroleum Institute U.S. crude stocks fell by 812,000 barrels last week to 482 million.
We expect bunker prices to demonstrate upward changes today: 3-5 USD up for IFO, 2-4 USD up for MGO.