Oil Prices and Bitumen Market Uncertainty Amid Conflicting Reports
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Oil and Bitumen Market Condition
The release of news about the decline in oil and fuel reserves of America and the warning from Saudi Arabia’s minister of energy led to a slight increase in crude oil prices but Brent oil could not exceed the level of 80 USD.
In the latest Qatar economic forum, the speeches of the heads of Qatar and Saudi Arabia caused some changes in the market trends. This forum was held on 23-25 May in Qatar. “The only thing that saved humanity and Europe this year was a warm winter, and the slowdown in the economy,” Qatari Energy Minister, Saad Al-Kaabi told the Qatar Economic Forum. He also warned, “worst yet to come”.
Besides, Saudi Arabia minister of energy warned the speculators that they will be ouching like in April. He said “I’m not a poker player … but I would just tell them, watch out.”
On the other hand, according to the Bank of America, oil will head towards 90 in the 2nd half of 2023.
“We’ll get back up over $80 in the second half of the tear, toward $90, because the deficit is going to get deeper over the course of the next six to nine months,” Blanch, head of commodities research at Bank of America told “Bloomberg Surveillance Early Edition” on Friday.
Furthermore, it is heard that more cut of supply is expected in the next meetings of OPEC, but it is not yet clear how much it might be.
In the meantime, the low demand for energy from the second economic power of the world was another reason to see insignificant growth in oil prices, although general conditions have improved compared to the past.
During the first 2 days of this week, Singapore’s HSFO CST180 increased by around 2 USD and its bulk bitumen reached 490 USD with only a 5 USD increase.
South Korea’s bulk bitumen was traded at 415 USD. The experts believe the insignificant increase in South Korea’s bitumen price was a result of a fall in bitumen price in the local markets of China.
For another week, bitumen price in Bahrain was stable at the level of 375 USD. After the fall of 8 USD in bitumen price in India, a different situation is imagined in India and by the start of the monsoon, a bigger drop in bitumen prices is expected to happen on June, 1.
On May 22, the base price of vacuum bottom dropped by around 2% in Iran and the average competition of 70% was recorded which is a sign of pressure in the market to reduce the prices. By decreasing the demand from India, the exporter hope for more businesses in other markets.
Considering the current crude oil price in the range of 75-80 USD and the approximate stability of the Iran Rial against the US dollar, it seems that the current prices of FOB Bandar Abbas have the lowest and best possible level.
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Like last weeks, Infinity Galaxy team keeps advising to trace market changes more carefully and consult with our experts for more accurate guidelines.
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