Weekly Bitumen Report: A Weak Growth of the Market after Several Weeks

Fifty eight days passed from the war between Russia and Ukraine, while Russia believed that it would finish within only 3 days and Kyiv would fall. During this time, the market experienced severe fluctuations like increase of crude oil prices up to 135 US dollars and its fall up to 97 US dollars, that means a fluctuation of 40% during 58 days that is unprecedented. The war is passing a critical period. In case of Mariupol fall, this city of Ukraine is in a very tense situation and widespread attacks to Kyiv is expected.

The energy crisis of the world is tied in with this war and we shall see its effects on oil price in short time.

Within the last week, the minimum and maximum levels of crude oil prices were 103 and 111 US dollars respectively. Till the time of preparing this article, the level of crude oil price stabilised at 107 US dollars and it faced less fluctuations during the week.

Considering the oscillations of crude oil prices, Iran is expected to increase its vacuum bottom price around 7-8 % on 24 April. The new tariff of port operation charges in the new year is expected to be effective from the next week in Iran. So the surge of bitumen prices in Iran is expected.

In Singapore, a slight fluctuation on bitumen price was observed, with a range of 545- 560 US dollars.

Based on the new announcements, it is expected that the shipping lines will apply a new wave of BAF from 1 May 2022 that will affect finished costs of the commodities.

In India, the market players are anticipating a fall of 15 -20 US dollars on 1 May, but it cannot be proved until its official announcement.

After almost one year, the JCPOA negotiations has not reached any clear conclusion and there is not any certain estimation whether there will be any agreement between Iran and the USA. These uncertainties strengthened US dollar value against Iran Rial around 4%.

Shortage of cash in some of the markets like east Asia seems to be a critical concern but it is heard that these issues will be sorted out in coming weeks.

It seems that in the current week, the market will face less confusion and the trend of the market will be an upward one, even at a gradual pace.

However, it is still a sensitive situation and risky time for heavy investments and it is better to make any deal based on the available demands.

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

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