MABUX: Bunker Market this morning June, 07.
MABUX World Bunker Index (consists of a range of prices for 380 HSFO, 180 HSFO and MGO (Gasoil) in the main world hubs) declined on June. 06
380 HSFO – USD/MT 373.57 (-3.07)
180 HSFO – USD/MT 422.79 (-3.35)
MGO – USD/MT 610.430 (-1.78)
Meantime, world oil indexes demonstrated irregular changes on June. 06 on a report that U.S. tariffs on Mexico might be delayed.
Brent for August settlement increased by $1.04 to $61.67 a barrel on the London-based ICE Futures Europe exchange. West Texas Intermediate for July delivery rose by $0.91 to $51.68 a barrel on the New York Mercantile Exchange. The Brent benchmark traded at the premium of 9.08 to WTI. Gasoil for June delivery declined by $0.25.
Today indexes continue to rise.
The U.S. may be considering delaying President Donald Trump’s threatened tariffs on Mexico as talks continue over stemming the flow of undocumented migrants and illegal drugs from Central America. That news pushed prices up.
U.S. refiners warned the Trump administration that tariffs on imports from Mexico could deliver a punishing blow to refiners and raise the cost of gasoline just as the U.S. driving season kicks into high gear. Trump surprised Mexico last week with a threat to impose 5% tariffs on all its exports to the United States unless the Mexican government took measures to stem the flow of illegal immigrants into the United States. The United States imports over 650,000 barrels of crude per day from Mexico, about 10% of total crude imports. Refiners are also worried that Mexico could retaliate with tariffs on its imports of U.S. fuel, a major source of revenue for the U.S. industry.
Meanwhile, the Energy Information Administration (EIA) on June 5 reported that U.S. crude supplies rose by 6.8 million barrels for the week ended May 31. That was the largest weekly increase in five weeks. At the same time U.S. oil production continue to rise for the third consecutive week. U.S. crude oil production averaged 12.4 million barrels per day (bpd) last week, up by 100,000 bpd from the previous week and up by about 1.6 million bpd year on year.
Moreover, U.S. oil production keeps accelerating towards new highs. New records are expected both when the final numbers for May emerge and at the end of the year. Rystad Energy is raising its forecast for US crude output to 13.4 million bpd by December 2019. For May 2019, researches and calculations point to crude oil production averaging 12.5 million bpd. Both are new all-time highs.
Traders are also watching updates on a production-cut agreement between the Organization of the Petroleum Exporting Countries and other major oil producers ahead of the deal’s expiration at the end of this month. The next OPEC meeting, which had been scheduled for June 25-26, may be postponed to early July at the request of Russia, according to some news reports.
At the same time Russian President Vladimir Putin said on June,6 Russia had differences with OPEC over what constituted a fair price for oil, but that Moscow would take a joint decision on output with OPEC colleagues at a policy meeting in the coming weeks. Putin said a price of $60- $65 a barrel suited Moscow, while Saudi Arabia wanted a higher price. He added that the decision by OPEC and its oil exporting allies should take into account the decline in production in Iran and Venezuela, and problems in Libya and Nigeria.
U.S. President Donald Trump said on Thursday he would decide whether to carry out his threat to hit Beijing with tariffs on at least $300 billion in Chinese goods after a meeting of leaders of the world's largest economies late this month. Relations between the United States and China have deteriorated since Trump in early May accused Beijing of reneging on commitments to change its ways of doing business with the rest of the world. The G20 summit, in Japan on June 28-29, marks the first opportunity for Trump and Chinese President Xi Jinping to meet since the last G20 summit in Buenos Aires in late 2018. Trump said a decision on the $300 billion will follow that meeting.
The U.S. Treasury Department on Thursday tightened its pressure on Venezuela's state-owned oil company by making clear that exports of diluents by international shippers could be subject to U.S. sanctions. The change, announced on the Treasury Department's website, is the latest U.S. measure aimed at pressuring Venezuelan President Nicolas Maduro by limiting access to oil export revenue from PDVSA.
Expect bunker prices little change today: 3-5 USD up for IFO, plus/minus 1-3 USD for MGO.