MABUX: Bunker market review as of morning March 07
The Bunker Review was contributed by Marine Bunker Exchange
MABUX World Bunker Index (consists of a range of prices for 380 HSFO, 180 HSFO and MGO (Gasoil) in the main world hubs) continued irregular changes on Mar. 06
380 HSFO - USD/MT 421.50 (-0.36)
180 HSFO - USD/MT 468.50 (-0.07)
MGO - USD/MT 641.64 (+1.00)
Oil prices dip as U.S. crude stocks swell amid record production, yesterday
U.S. crude oil inventories rise amid record output - EIA
WTI eased on Wednesday, dragged down by record U.S. crude output and rising commercial fuel inventories, meanwhile Brent little change.
U.S. crude oil stockpiles rose much more than expected last week, with inventories up by 7.1 million barrels to 452.93 million barrels, according to a weekly report by the U.S. Energy Information Administration (EIA) on Wednesday. U.S. crude oil production remained at a record 12.1 million barrels per day (bpd), an increase of more than 2 million bpd since early 2018.
Surging U.S. production is undermining efforts led by the Organization of the Petroleum Exporting Countries (OPEC) this year to withhold around 1.2 million bpd of supply to tighten markets and prop up prices.
“The balance between rising U.S. production and the OPEC+ efforts to stabilize prices with a production cut was broken by higher than expected U.S. inventories and the OECD warning of lower global growth impacting energy demand going forward,” said Alfonso Esparza, senior analyst at futures brokerage OANDA.
Market sentiment today Thursday morning
Oil edged up on Thursday amid ongoing OPEC-led supply cuts and U.S. sanctions against exporters Venezuela and Iran, but price gains were capped by record U.S. crude output and rising commercial fuel inventories.
U.S. West Texas Intermediate (WTI) crude oil futures were at $56.31 per barrel at 0637 GMT, up 9 cents, or 0.2 percent, from their last settlement.
Brent crude futures were at $66.22 per barrel, up 23 cents, or 0.4 percent.
Prices are being supported by efforts led by the Organization of the Petroleum Exporting Countries (OPEC) and other countries - a grouping known as ‘OPEC+’ - to withhold around 1.2 million barrels per day (bpd) of oil, a strategy aimed at tightening markets.
Oil market sentiment has swung from bearish to bullish in the last few days as tailwinds for the commodity strengthen. A string of updates from OPEC and Venezuela, along with a couple of oil price forecasts served to push Brent to the highest since the start of the year, with prospects for the near future also positive.
OPEC said in its latest monthly oil market report its total production last month had fallen to 30.8 million bpd, down by almost 800,000 bpd, as the cartel seeks to prop up prices once again. That’s down from 31.6 million bpd in December and was in large part driven by Saudi Arabia’s efforts to accelerate the price rise by cutting more. The Kingdom pumped 350,000 bpd less oil in January than in December, at 10.2 million bpd, which was also more than it had agreed to cut.
Judging by the reaction of prices, with Brent touching US$65 a barrel earlier this week for the first time in more than a month, the “whatever it takes” approach has finally started working.
Oil Future close 6th March
Brent: $65.99(+0.13)pbr Front Month May
WTI: $56.22(-0.34)pbr Front Month April
MGO: $620(+0.75)/mton Front Month March
NY Harbor Ulsd: $620.71(-0.06)/mton Front Month April
Oil Future trading at GMT: 07.54; Brent:+12 cents, WTI:+3 cents
Expect bunker prices little change. General tendency irregular at present.
