Weekly Lubricant & Chemical Report: The Heavy Shadow of OPEC Production Cut on the Commodity Markets

During the last week, with the reduction of 2 million barrels of OPEC, the price of crude oil increased from around $86 to $97. This increase of $11 caused the price of fuel in Singapore to increase by $37 within the last 5 days when the oil and energy markets of the world were open.

This change in the oil price increase, which happened based on OPEC’s decision, caused the markets in Singapore, Iran, India, Bahrain, and North Africa to face a serious increase.

In Iran, the production of petroleum products faced heavy competition between 30 to 55%, and the price of many goods jumped by more than 50%. 

The war situation in Ukraine has become complicated to a great extent, and with the Ukrainian military attack on the bridge connecting Crimea to Russia, the situation has become such that it seems that Ukraine has been able to gain an upper hand in the war in some places over Russia.

It causes major changes in the war and on the other hand, the fact that it can have an impact on the energy crisis in the world should be examined in the coming week.

On the other hand, the lack of success in the JCPOA and rumors of renewed negotiations could not control the increase in the price of the dollar in Iran, and the rial’s parity against the dollar is still at its highest historical level. 

In total, the price of recycled base oil in Iran in the current situation is estimated to be around $830-$840 for FOB Bandar Abbas, $1150-$1250 for paraffin wax, and $690-$700 for caustic soda.

China Caustic Soda Market Condition

The local market in North China continued to rise, and Shandong has a large plant equipment planned to overhaul within the month. Generally, the current market supply and demand is temporarily tight in China.

This article was prepared by Mozhdeh Darbandizadeh, the account manager of Infinity Galaxy (www.infinitygalaxy.org).