MABUX: Bunker prices set to edge down again
The Bunker Review (Week 38, 2015) was contributed by Marine Bunker Exchange
Oil rallied on large U.S. drawdown on Wednesday, and prices jumped as much as 6 percent. Official data from the U.S. Energy Information Administration showed a total U.S. inventory drop of 2.1 million barrels for the week ended Sept.11.
At the same time the EIA also cited an unexpected build of about 3 million barrels in gasoline and distillate stocks, which were completely neglected. A total stockpile of 153 million barrels for distillates is huge.
Oil has seen big price swings since the end of August on a mixed supply-demand outlook from the EIA and OPEC. The influential Wall Street trader Goldman Sachs’ lower projections for forward oil prices added to the volatility.
Some analysts expect an erratic but continuous recovery from the 6½ year lows of $42.23 hit in Brent and $37.75 in U.S. crude in August.
If the market continues to receive data similar to this week, oil prices might continue to firm up and find support.
On Thursday oil prices slipped again below $50 a barrel, after weak Japanese data sounded alarm bells over the prospects for global growth, outweighing the bullish impact of a bigger than expected decline in U.S. crude oil stocks.
Japan’s exports slowed for a second straight month in August in a sign China’s economic slowdown could be damaging the world’s third-biggest economy.
The data follows worrying figures from other Asian economies – including South Korea and Taiwan – which are increasing anxiety over the consequences of a sharp slowdown in China.
At GMT 13:12 on Thursday the oil market was slightly down, Brent $49.20(-0.55) and WTI $47.05(-0.10).
But we must not forget the world is still awash with oil, with global production running at more than 2 million above demand, filling stock piles around the world. The general trend is still downward.
For next week bunker market is expected to edge downward again. Every time the bull speculators managed to force the oil prices upward it has been extremely short lived and bunker prices returned back to price levels where they belong.
*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)
