Weekly Bitumen Report: The Shadow of Sudden Fall of Crude Oil
Israel- Hamas war that started on 7 October is passing its worst bloody days so that President Biden clearly criticized Israel. However, the situation has not changed in the region yet. On December 12, the Houthi movement of Yemen announced that they had missile attack on Norway-flagged tanker of STRINDA to show their objections to the bombardment of Qaza by Israel.
On December 14, the European Union held a meeting with the purpose of economic help to Ukraine and its membership. It is still not clear to what extent these maters will affect the future of Ukraine war.
Last week, Italy officially announced its withdrawal from the project of China’s Belt & Road Initiative. It was an important matter to China as Italy was the only member of G7 group that was involved with this project. This can lead to serious concerns for China in this project.
For the third consecutive time, on 12 December, Federal Reserve kept the interest rate at the highest level during the last 22 years to show that there will be 3 falls of interest rate in the next year and after spring. As a result, after 7 continuous falling weeks, crude oil prices fell 3% on Tuesday. After the increase of USA consumers’ cost in November, crude oil reached its lowest level from June and based on the evidences, it seems improbable that Federal Reserve moves toward the price fall by the beginning of the next year.
In the meantime, in the latest report of Energy Information Administration the price of crude oil was predicted to be 10 USD less in 2024 and in a short-term vision. However, based on the latest decision of OPEC, the member countries of this agreement will increase their voluntary reduction from the beginning of 2024.
In the meantime, in the meeting of COP28 on Wednesday, the agents of 200 countries agreed to start the reduction of global consumption of fossil fuels. It is not clear how long they will remain committed to this agreement.
On December 13, Singapore’s HSFO CST180 traded at 383 USD and Singapore’s bulk bitumen price reached 460 USD. Bitumen price in South Korea was at the level of 380 USD.
Bahrain’s bitumen price is still at 400 USD and European regions experience the channel of 380-450 USD.
The reports received from India show weak demands in a way that there will be probably the fourth consecutive fall in the mid of December with around 16 USD fall.
In Iran, the refineries have still no significant competition for vacuum bottom and it is mainly sold without any competition. Same as the previous week, the producers and exporters are facing strong pressures in the field of export.
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This article was prepared by Razieh Gilani, the export manager of Infinity Galaxy.
