Bunker prices to continue descent next week, with periods of stability
The Bunker Review is contributed by Marine Bunker Exchange
US crude prices (WTI) fell almost $40 a barrel on Thursday, their lowest since the global financial crisis of 2009, as supplies rose in North America and the Middle East, filling stockpiles to record levels. Oil has lost a third of its value since June on high U.S. production, record crude pumping in the Middle East and concern about falling demand in Asian economies. - All the main oil futures contracts looked to be heading lower and the trend is down and vicious.
U.S crude oil, West Texas Intermediate (WTI), was down 50 cents at $40.30 a barrel by 1030 GMT, after hitting a new 6-1/2-year low of $40.21.
The Brent crude futures, the global oil benchmark, were down 75 cents at $46.41 a barrel, still some way off their 2015 low of $45.19 traded in January.
U.S. crude inventories rose 2.6 million barrels last week to 456.21 million barrels, the government’s Energy Information Administration said. Markets had been expecting a stock draw and the news pushed WTI down more than 4 percent on Wednesday. Stockpiles rose partly because a U.S. refinery closed for repairs last week, but also because imports rose to their highest level since April.
OPEC continues to pump record levels of oil, adding to the global oil glut. Saudi Arabia exported 7.385 million bpd in June, up from 6.935 million bpd in May, industry data showed.
Adding to oil’s bearish environment, Chinese equities fell more than 3 percent on Thursday as worries about the world’s second largest economy persists.
Stocks, oil and emerging market currencies fell on Thursday as fading expectations for an imminent U.S. interest rate hike stoked anxiety about the health of the global economy. Shares in Asia hit a two-year low, German stocks extended losses in what is shaping up to be their worst month in over three years, and British stocks hit their lowest since January. U.S. stocks were set to fall as well.
When will the overproduction of crude oil stop? Is it worth it to produce so much crude well over 3 million barrels per day globally in order to maintain a market share and by doing so depleting the sources of oil? It is a give-away from the oil producing countries’ wealth and leave less for future
generations.
For next week expect bunker prices to continue its general downward trend but with periods of stability.
* MGO LS
All prices stated in USD / Mton
All time high Brent = $147.50 (July 11, 2008)
All time high Light crude (WTI) = $147.27 (July 11, 2008)
