Weekly Bitumen Report: Strong Export Pressures in Iran

The 7^th Gas Exporting Countries Forum (GECF) Summit is being held in Algeria while the world geopolitical incidents have made changes in the dynamics of global markets of energy. Israel’s war in Gaza, continuation of Houthi attacks to the commercial vessels in the Red Sea and Gulf of Aden led to the route changes of some LNG vessels. This brought about surges in transportation costs and longer delivery of the goods. However, the price of natural gas has significantly dropped at the same time as this summit is being held.

On Tuesday, Michelle Bowman, the head of Federal Reserve, announced that there is no hurry to cut the USA interest rate, especially given the upward risks for inflation that could halt progress in controlling price pressures or even revive them. At the same time, Joe Biden, stated that Israel agreed to discontinue the military activities in Gaza in honor of Ramadan Month. However, Israel, Hamas, and Qatari mediators have all warned about the slow improvement of the ceasefire in Gaza.

After the report of Reuters about the extension of voluntary oil production cuts for the second three-month period by the Organization of the Petroleum Exporting Countries (OPEC), the future prices of Brent oil and WTI increased more than one dollar per barrel on Wednesday.

Citing 3 sources, on Wednesday, Reuters reported that the new round of America’s sanctions against Moscow will make the sale of Russia’s oil to India more complicated. Washington announced this decision on the second anniversary of Russia’s military attack on Ukraine.

On Wednesday, Singapore’s 180 CST decreased around 5 dollars and closed at 446 USD and its bitumen remained unchanged at 425 USD.

South Korea’s bulk bitumen observed no changes and it settled at 410 USD.

Bitumen price in Bahrain is still fixed at 360 USD.

The range of bitumen prices in Europe was 430-480 USD.

It is expected that India will see a minor hike in bitumen prices on March 1^st, it will be the third frequent raise of bitumen prices since the beginning of February.

Approaching the end of year, the export pressure in Iran becomes more tangible and more disorders can be observed in the vessel schedules due to unpleasant weather conditions in the Persian Gulf and the exporters are facing more pressures.

During the last week, there was negligible competition for vacuum bottom and there will be some increases in the base price of VB within the next 5 days in Iran.

Same as previous weeks, Infinity Galaxy recommends the activists of the field to make their business decisions after having a comprehensive investigation of the market situation.

This article was written by Razieh Gilani, the export manager of Infinity Galaxy.