Weekly Bitumen Report: The Market Under the Influence of COVID Outbreak in China

During the last week, the world of economy was following the outbreak of COVID in China worryingly. By the announcement of new cases in China and more new restrictions in the 7 cities of China, there were objections to the zero COVID policy. This wave of objections and the outbreak of the virus led crude oil to reach 81 USD. But, it seems China’s government has lessened the restrictions, and other cities did not undergo full lockdown.

However, by the outbreak of Corona and the fall in fuel prices, Singapore’s fuel declined to less than 400 USD once again, and the market faced severe fluctuations. On 29 November, Singapore’s fuel increased around 26 USD and reached 395 USD, and on November 30, it fell to 21 USD and reached 374 USD.

These fluctuations had other side effects, while the level of demand in the European and Mediterranean markets was increasing, they stopped to trace the pricing status of the market and the Asian markets were worried about the fall of prices.

During the last week, Singapore’s bulk bitumen price reached around 510 USD, and South Korea’s bulk bitumen was 400 USD. In the meantime, Bahrain faced another week of stability in prices and its prices remained stable in the range of 425 USD. Bitumen price in India increased by around 20 USD on 1 December.

By the drop of fuel oil and crude oil, the average competition among refineries reached from 64% to less than 50% and the exporters followed the prices in fear.

The drop in container shipping costs shows a decrease in the export level in many of the markets. However, the export of bulk bitumen from the southern ports of Iran was growingly higher than in previous years so over 120,000 MT of bulk bitumen was exported only in November. By the significant increase in bulk bitumen price and the low difference between the prices of bulk and packed bitumen, we can expect the growth of packed bitumen export.

However, considering the current fluctuations in the market, the decisions should be made more cautiously.

This article was prepared by Razieh Gilani, the export manager of Infinity Galaxy (www.infinitygalaxy.org).