Weekly Bitumen Report: Sanctions and Commercial Tension, Main Components of Energy Markets

During the last week, the political and economic developments from America influenced energy markets. America imposed new sanctions against Chinese independent refineries due to the purchase of oil from Iran.

At the same time, Trump’s government announced the implementation of new tariffs against imported goods from China. The tariffs include the products like mineral substances, medicine, and industrial equipment. In response to this action, China stopped purchasing the new orders of Boeing from the U.S.

The combination of these measures has led to a decline in the indices of Asian and Persian Gulf markets. Additionally, gold prices hit a historical record and reached $3,290. This increase indicates a surge in concerns and a tendency of investors toward safe assets.

In the Middle East, the conflicts between Israel and Axis of Resistance continue. There have been some reports regarding Houthis missile attacks. However, there has been no direct impact on oil prices yet.

The peace situation between Russia and Ukraine remains uncertain.

The analysts are not optimistic about stability of growth in oil prices. Goldman Sachs predicted that oil price would reach $63 by the end of 2025. Besides, HSBC Bank estimated the range of oil prices at $68.5 in 2025.

These forecasts have been proposed based on the possibility of oversupply, decline in China’s economic growth and the U.S. Contractionary Monetary Policy.

Overall, the combination of sanctions, commercial tension, and supply pressure are 3 main components guiding the market in the coming weeks.

On Thursday, Brent Crude oil reached $66.48. Singapore 180CST closed at $432. Bitumen prices in Singapore and South Korea recorded the level of $415 and $385, respectively.

In Bahrain, bitumen prices are still unchanged at the level of $420, and Europe faced a fall in its bitumen prices and reached the level of $380-420.

In India, bitumen price increased about 2$ for VG30 and $2.5 for VG40 on April 15, however, this surge was lower than expected raise that can be because of a fall in crude oil prices in first half of April. Bitumen prices in India are likely to remain stable at the beginning of May due to high demand in the country.

During the past week, U.S. dollar value decreased about 19% against Iran Rial by the ongoing negotiations between Iran and America in Oman. On the other hand, the pressure of fall in crude oil prices within the last one month led to the prediction of a fall in vacuum bottom prices. As a result, Iran bitumen prices are under severe pressure of international political conditions between Iran and the U.S, and recent drops of oil prices that led to a dilemmatic situation in the Iran’s bitumen market. The gap between the highest and lowest offered prices was about $25.

Currently, the influential international factors and the second round of negotiations between Iran and the United States in Italy are the most important topics affecting the future price of bitumen in Iran.

To check the latest bitumen prices at different destinations, check the Infinity Galaxy website: https://infinitygalaxy.org/bitumen-price-today/.
This article was prepared by Razieh Gilani, the export manager of Infinity Galaxy.