MABUX: Bunker market this morning, Apr.29.

MABUX World Bunker Index (consists of a range of prices for 380 HSFO, 180 HSFO and MGO (Gasoil) in the main world hubs) continued upward trend on Apr.26:

380 HSFO – USD/MT – 443.64(+6.35)
180 HSFO – USD/MT – 491.21(+5.28)
MGO – USD/MT – 661.79(-1.50)

Meantime, world oil indexes fell sharply on Apr.26 as the market reassessed the impact of U.S. sanctions on Iran.

Brent for June settlement decreased by $2.20 to $72.15 a barrel on the London-based ICE Futures Europe exchange. West Texas Intermediate for June delivery lost $1.91 to $63.30 a barrel on the New York Mercantile Exchange. The Brent benchmark traded at the premium of 8.85 to WTI. Gasoil for May delivery dropped by $23.00.

Today morning oil are changing irregular with no any firm trend so far.

Global oil markets are still adjusting to President Trump’s decision to not extend the 180-day waiver for Iranian oil imports to the country’s eight largest customers. Saudi Arabia, for its part, said that it saw no need to increase oil production after the Iranian oil waivers expire on May 2. It also added that it would respond to customers’ needs if asked for more oil.

While Saudi Arabia and the UAE have apparently indicated a willingness to offset Iranian disruptions, it would come at the expense of spare capacity. OPEC has about 3 million bpd of spare capacity, but Iran could lose nearly 1 million bpd if the U.S. succeeds. An outage elsewhere leaves little margin for error.

Asian companies are beginning to pull back from Iran, fearing retaliation from U.S. sanctions. Iran had hoped that international companies, especially companies from China, would provide an economic lifeline after the U.S. withdrew from the nuclear deal. But many deals between Iran and China have been stopped now. China may try to continue to import oil from Iran, defying U.S. sanctions, but Chinese companies are curtailing their exposure.

Citing quality concerns, Germany and Poland temporarily suspended imports of oil from Russia. The suspension could have knock on legal effects, as buyers in Western Europe could open up lawsuits against Russian suppliers.

President Trump indicated his support for the Libyan National Army’s (LNA) assault on Tripoli in a phone call with general Khalifa Haftar last week, reversing official U.S. policy of supporting the internationally-recognized government in Tripoli. Trump stressed Haftar’s importance in securing Libya’s oil fields.

PDVSA (Venezuela) expects a sharp decline in oil production in April. A string of blackouts in the last few weeks have caused extended outages at crucial oil facilities including the upgraders, which have a combined capacity of 700,000 bpd. On top of the massive blackouts, Venezuela’s oil industry suffered in the past two months from the U.S. sanctions, the continued economic crisis, and the chronic underinvestment in its oil facilities. Venezuela’s crude oil production plunged by 289,000 bpd from February to below 1 million bpd-to 732,000 bpd in March.

The number of active oil and gas rigs fell sharply in the United States last week, the second large drop in as many weeks, keeping the overall rig count below year-ago for the second week in a row. The total number of active oil and gas drilling rigs in the United States fell by 21, with the number of active oil rigs falling by 20 to reach 805 and the number of gas rigs falling by 1 to reach 186. The combined oil and gas rig count is now down year on year for the first time since the end of 2016. Despite of that, US crude oil production is still at near all-time highs, and for week ending April 19, US oil production stood at 12.2 million barrels, resuming its previous all-time high first reached for week ending March 29.

We expect bunker prices will drop today in a range of minus 10-16 USD.
Source: Marine Bunker Exchange