Weekly Bitumen Report: The Waves of Prices are still Upward

On 7 November 2021, the rate Iran vacuum bottom dropped around 6% considering fall of fuel and the bitumen market experienced a temporary fall of rates up to 25 US dollars but from 8 November 2021 and from the first supply of vacuum bottom by IME, frequent competitions happened during the weeks in different levels varying from 26.53% to 47.95% and hence not only the fall of 6% was covered, but also the bitumen rates faced another surged. These competitions can be interpreted as high demand of the buyers in the market and also as suppliers are expecting increase of rates within the next two weeks, so these competitions are good solution to keep the price levels fixed.

A shortage of vacuum bottom supply by the refineries made the factories purchase vacuum bottom as much as possible. Based on these reasons, bitumen prices were again as high as last two weeks and as it was mentioned in last week report of Infinity Galaxy, there is no sign of fall of prices in the market.

The complicated situation of the shipping lines is another important concern of both suppliers and buyers. It is heard that only one direct vessel is working in the route of Bandar Abbas to Mundra. The shortage of container and high costs of ocean freight are other points that shall be taken into consideration. The crisis of marine transportation was also reported in the two main presses of Associated Press and Yahoo Finance by Infinity Galaxy too.

Based on unofficial news, a better situation of the marine transportation can be anticipated from January 2022 in a global point of view but for the time being, the crisis of containers, vessel space and high ocean freights is serious.

Within the week, oil price raised up to 85 US dollars but till the time of preparing this report it touched the level of 82 US dollars. These 2-3% fluctuations within one week can be unprecedented in general but nowadays we are almost facing these tolerance of rates weekly. Up to the time of preparing this report, fuel oil increased up to 10 US dollars comparing to its last week rate and if it keeps increasing, another surge of bitumen price can be expected.

Also, an increase of 10,000 Rial of US dollar against Rial was observed that made importers think that it will get strengthen against Rial again and hence bitumen price will fall but it cannot be a right conclusion as the nuclear negotiations between Iran and 5+1 will start within next weeks more seriously and again fall of US dollar value can be expected.

Overall, it can be concluded that still there is no sign or decision regarding drop of bitumen prices as it was mentioned in last week analysis.

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