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MABUX: Bunker market review

MABUX World Bunker Index (consists of a range of prices for 380 HSFO, 180 HSFO and MGO (Gasoil) in the main world hubs) demonstrated slight upward changes on March, 07.

380 HSFO – USD/MT 421.86 (+0.36)
180 HSFO – USD/MT 466.36 (+0.86)
MGO – USD/MT 643.07 (+1.43)

Oil prices drop as ECB warns on weaker economy, U.S. supply soars

Oil prices fell on Friday after the European Central Bank (ECB) warned economic weakness would continue and as U.S. crude output and exports chase new records, undermining efforts by producer club OPEC to tighten global markets.

Financial markets, including crude oil futures, took a hit after ECB President Mario Draghi said on Thursday the economy was in “a period of continued weakness and pervasive uncertainty”. Europe’s economic weakness comes as growth in Asia is also slowing down.

A slowdown in economic growth would also likely result in stalling fuel demand, putting pressure prices.

On the supply side, prices have been receiving support this year from output cuts led by the Organization of the Petroleum Exporting Countries (OPEC). Together with some non-affiliated producers like Russia, the producer group has pledged to withhold around 1.2 million barrels per day (bpd) of supply to tighten markets and prop up prices.

But these efforts are being undermined by soaring U.S. crude oil production C-OUT-T-EIA, which has increased by more than 2 million bpd since early 2018, to an unprecedented 12.1 million bpd. That makes America the world’s biggest producer, ahead of Russia and Saudi Arabia.
Financial markets, including crude oil futures, took a hit after ECB President Mario Draghi said on Thursday the economy was in “a period of continued weakness and pervasive uncertainty”. Europe’s economic weakness comes as growth in Asia is also slowing down.

So far oil demand has held up, especially in China where imports of crude remain above 10 million barrels per day (bpd).

Yet a slowdown in economic growth will at some point likely dent fuel demand, putting pressure prices.

China’s February dollar-denominated exports fell 21 percent from a year earlier, coming in far worse than analysts’ expectations, while imports dropped 5.2 percent, official data showed on Friday.

Some analysts even expect the United States to soon overtake Saudi Arabia as the world’s biggest oil exporter.

Beyond added supply to global markets and likely downward pressure on crude prices, Rystad said this export surge would have huge benefits for the U.S. economy.

“The U.S. trade deficit will evaporate, and its foreign debt will be paid quickly thanks to the swift rise of American oil and gas net exports,” said Rystad Energy senior partner Per Magnus Nysveen.

China
Financial markets, including crude oil futures, took a hit after ECB President Mario Draghi said on Thursday the economy was in “a period of continued weakness and pervasive uncertainty”. Europe’s economic weakness comes as growth in Asia is also slowing down.

So far oil demand has held up, especially in China where imports of crude remain above 10 million barrels per day (bpd).

Yet a slowdown in economic growth will at some point likely dent fuel demand, putting pressure prices.

China’s February dollar-denominated exports fell 21 percent from a year earlier, coming in far worse than analysts’ expectations, while imports dropped 5.2 percent, official data showed on Friday.

Oil Future close 7th March:

Brent: $66.3(+0.31)pbr FM May
WTI: $56.66(+0.44)pbr FM April
MGO: $622.25(+2.25)/mton
NY Harbor Ulsd: $619.63(-1.08)/mton

Oil Futures trading at GMT: 07.44; Brent:-76 cents, WTI:-57 cents
The Market tendency is downward at present.

Expect bunker prices trading irregularly. Oil Futures closed slightly upward last night and at present the market is falling.
Source: Marine Bunker Exchange

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