Weekly Bitumen Report: The Fundamental Persistence against Uptrend Signals of Market
During the last week, the price of crude oil dropped significantly because of concerns about the lack of agreement on the debt ceiling in America. However, on June 1, it faced a slight increase by the release of news about the agreement between the two parties of America on the increase of debit ceiling.
According to Oilprice “The debt ceiling bill proposed after talks between President Biden and House Speaker Kevin McCarthy cleared the first hurdle, with the House of Representatives giving it broad bipartisan support.”
The next hurdle to be cleared is the Senate.”
It continues that “Should the bill pass there, too, the U.S. federal government will once again narrowly avoid defaulting on its debt and the prospects of oil demand growth in the world’s largest consumer will improve.”
In the meantime of the weak trend of crude oil, the drone and missile attacks of Russia and Ukraine started against each other and the intensification of the attacks may cause new changes in some of the markets.
The other markets got affected by the fall of crude oil prices in the global markets. Singapore’s HSFO CST180 faced a severe drop of 16 USD on 31 May. A fall of 10 USD in bulk bitumen prices in Singapore and South Korea recorded prices of 475 and 400 USD, respectively.
Bahrain bitumen price is still fixed and unchanged at the level of 370 USD.
Bitumen price in India finally dropped around 28 USD on 1 June after 2 weeks of various rumours about the price drop. This was the highest fall within the last 3 months.
But the situation in the Persian Gulf was completely different. Several factors led to the devaluation of the US dollar against the Iran Rial including the travel of the Sultan of Oman to Iran and the news about new agreements between Iran and America and the release of frozen bounds of Iran (7 billion US dollars) in South Korea and more agreements between the 2 countries. More devaluation of USD is expected in Iran.
The level of competition for vacuum bottom decreased to around 70% but the concerns of exporters about more fall of USD value caused a fragile bitumen price in Iran. Hence, although the current bitumen price in Iran is at its lowest level within the last 1 month, any small changes in crude oil price or exchange rate can lead to significant surge of the prices.
It seems that market can experience new positive changes by the agreement between the 2 parties of the USA and the release of Iran’s frozen bound. Besides, the possibility of price increase is more probable than its decrease.
The current advice Infinity Galaxy team for the market role players is to evaluate the conditions affecting their businesses. Our experts are available for purchase guidelines.
This article was prepared by Razieh Gilani, the export manager of Infinity Galaxy (https://infinitygalaxy.org/)
