USA’s agreement may lead to positive market changes. price increase is more likely than decrease.
Over the course of the preceding week, the cost of crude oil experienced a marked reduction due to apprehensions surrounding the absence of consensus regarding America’s debt ceiling. On June 1st, a marginal uptick was observed due to the announcement of an accord between the two American parties concerning the augmentation of the debt ceiling. Such news carried significant weight and had a discernible impact on market conditions.
As per Oilprice, the debt ceiling bill, which was the result of a discussion between President Biden and House Speaker Kevin McCarthy, has cleared the preliminary obstacle as it garnered extensive bipartisan support from the House of Representatives.
The subsequent obstacle to surmount would be the approval of the Senate.
The passage continues by stating, “In the event that the aforementioned legislation were to be approved in said location, the United States would be affected. ” The federal government is expected to narrowly avert defaulting on its debt once again, thereby resulting in potential improvements in the prospects of oil demand growth of the world’s largest consumer.
During the period in which crude oil exhibited a weakened trend, the occurrence of drone and missile attacks between Russia and Ukraine has commenced. The escalation of these attacks has the potential to induce novel fluctuations within certain market domains.
The decline in global crude oil prices had a detrimental impact on several other markets. On 31 May, the HSFO CST180 in Singapore experienced a substantial decrease of 16 USD. A price decline of 10 USD in the market value of bulk bitumen in Singapore and South Korea resulted in the respective recorded prices of 475 USD and 400 USD.
Bitumen price in the middle eastern countries
The current bitumen price in Bahrain remains constant and unaltered at the mark of 370 USD.
The bitumen price in India experienced a noteworthy decline of approximately 28 USD as of 1st June, following a turbulent two-week period characterized by rumors regarding a forthcoming price reduction.
However, the circumstances pertaining to the Persian Gulf exhibited contrasting features. The devaluation of the US dollar in comparison to the Iranian Rial can be attributed to a multitude of factors. Specifically, the visit of the Sultan of Oman to Iran, the revelation of newly established agreements between Iran and the United States, the unblocking of previously frozen Iranian assets totaling 7 billion US dollars in South Korea, and the formation of further agreements between the two nations have all played a significant role in this economic trend. It is anticipated that further depreciation of the United States dollar will occur in Iran.
The vacuum bottom market experienced a decline in competition, with a reduction of approximately 70%. However, the apprehensions of exporters regarding a possible further decline in the value of the United States Dollar have led to a precarious state of the bitumen price in Iran. As such, the stability of the market has been compromised due to external factors influencing the economic landscape. Thus, despite the present downward trend in bitumen pricing in Iran, observed over the preceding month, any minor alterations in both the rate of crude oil or exchange rate can feasibly result in a noteworthy escalation of said prices.
The recent concord between the United States and Iran, coupled with the unfreezing of the latter’s financial assets, holds the potential to engender favorable developments within the market. Moreover, the likelihood of a rise in price is greater than that of a decline.
