Weekly Oil Report: Fluctuations Happens with Fears and Uncertainties

Falling and growing back was the recap of oil in the second week of September. Bitumen also had fluctuations but demand did not stop.

Brent finally closed at $91.53 and WTI settled at $85.28 on Friday.

WTI stalls in the region of 90 to 81 moving between two yellow convergent lines. In the Daily chart of Brent and WTI, you can see that the movement is the same and the market is a little weak. The weakness is due to uncertainties in the market. Economic conditions, supply and demand are vague for market participants.

The upcoming week might also be the same as last week, with several falls and growth.

One of the weakening factors of WTI was the possibility of a nationwide railway strike in the US. Although the government could avert the strike by improving workers’ conditions and wages, it showed how fragile the US energy segment is. Gas futures spiked by 10% in only one day by fears of railway delivery disruptions.

China and Russia’s presidents met on September 15 in Uzbekistan for the first time after the Ukraine war. Putin and Xi Jinping agreed to replace Rubles in their oil trades to decrease US dollar hegemony in national trades. Two countries are keen to make a new world together.

Supply is at risk in Kazakhstan and Venezuela. The US threatened Venezuela with more sanctions if it fails in negotiations. Kazakhstan is also unlikely to be capable of increasing its production soon.

The US also suggested that the country can refill the SPR only when oil falls below 80.

Oil fluctuations pumped mixed signals into the bitumen market too. Bahrain’s bitumen decreased by about $20 and fell to $440 while Singapore’s price was almost steady.

On the other hand, India increased bitumen price by $9 on 15 September.

It is likely that Iran decreases its bitumen price by over 10% during the week.

HSFO fluctuations also followed crude oil, going up at first of the week and then retreating.

These ups and downs are the results of uncertainties above crude oil. Accordingly, shipping freights decreased by lower export volumes. However, it is the end of the season and there can be new movements and orders.

The consequences of the ongoing JCPOA and the death of Queen Elizabeth II are still unknown to the market.

Currently, Iran’s new steel drum is in the range of $385 – $390. Singapore bulk was $550 – $555, south Korea 60/80 was $495-500 and Bahrain stayed unchanged at $440-$445 on Friday, 16 September.