Weekly Bitumen Report: Conflicting Signals in the Global Bitumen Market

During the last week, the Brent crude oil price could not cross the $90 again, and the highest price it recorded was around $88.

The reason is mainly the resistance created by the oil price of 90 dollars, which is due to the forecast of further economic recession in 2023 and the concern of the spread of the corona virus in China. Generally exceeding the price of 90 dollars requires powerful components.

Meanwhile, the senior official of the International Monetary Fund mentioned again on January 13 that 2023 will probably be a difficult year for the world economy. She also said that China should continue its economic reopening policy after two years of disruption caused by its zero-covid policy.

Ms. Georgieva said that China’s return to normal conditions will most likely be the most important factor in the world’s economic growth this year, while financial institutions say that the speed of economic growth in the world will likely decrease this year.

However, on Wednesday, January 25, after the opening of the Singapore Stock Exchange in the Chinese New Year; most of the commodity symbols were positive, so that Singaporean HSFO 180 CST rose by $6 and reached $410 and Singapore bitumen reached $510 which increased 5$.

South Korean bitumen remained unchanged at $420.

Last week’s signals of the bitumen market were not in the same direction; while some rumors indicated a further drop of $50 from Bahrain, the price of Bahrain bitumen was offered at $325 for the sixth consecutive week.

News received from India that the price of bitumen will probably decrease on February 1st, now the news shows there will be a slight decrease or stabilization of prices. After the release of new news from India that probably India’s domestic need for bitumen will reach more than 8 million tons in 2023; hopes for economic recovery are heard from this country.

In Iran, despite the unprecedented drop in the value of the rial against the dollar; there was intense competition for the purchase of vacuum bottoms among bitumen producers, and the average competition was over 60%. Also, along with the increase in competition, the announcement of the GRI of shipping for export loads was another reason for the increase in the price of Iran’s export bitumen.

However, it seems that due to the completion of the Chinese New Year holidays; the relative stability of the oil price in the range of 80 to 90 dollars and market demand, February is likely to be a better month for exports and commercial activities based on previous forecasts.

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