After months of stability, bitumen prices in Iran are rising due to higher costs and a weaker US dollar.
The unsuccessful assassination attempt on Donald Trump and the subsequent increase in his chances of winning the next U.S. presidential election have led to a sustained uptrend in commodity markets over the past week. Amid the political turmoil within the Democratic campaigns and Trump’s rising success, the current situation is likely to be reinforced.
Meanwhile, Hungarian Prime Minister Orbán Viktor, head of the European Commission, stated that Donald Trump is “ready to act as a peace broker” between Russia and Ukraine if he becomes president. However, most European leaders are dissatisfied with Trump’s performance and outlook, as well as his trips to Russia and China.
More than two years into the Russia-Ukraine war, there remains no definitive resolution. Despite international protests and numerous casualties, the balance of the war appears to favor Russia. Similarly, despite efforts for a ceasefire, the Israel-Hamas conflict continues, with the latest Israeli airstrike in southern Gaza resulting in at least 90 deaths.
In China, during a key meeting of senior leaders to address the country’s sluggish economic growth, official data revealed that China’s economy weakened in the second quarter of the year. Ending in June, the second quarter saw a 4.7% growth, falling short of expectations following a strong start in early 2024. The government targets an annual growth of 5%. China, the world’s second-largest economy, is grappling with long-term real estate crises, heavy domestic government debts, slow consumption, and high unemployment rates.
Over the past week, global crude oil prices have stabilized and strengthened within their previous ranges, despite a reduction in reserves due to Chinese demand and various global political events.
Meanwhile, Russia’s deputy Prime Minister announced that global crude oil markets are expected to balance in the second half of 2024, considering OPEC’s agreements. However, it’s unclear if this balance will lead to price increases or decreases from his perspective.
On July 18, Brent crude oil remained steady at around 85.5 USD, and Singapore’s CST180 traded at 509 USD. Bitumen prices in Singapore and South Korea closed at 475 and 395 USD, respectively. In Bahrain, bitumen prices remain fixed at 450 USD. In Europe, the range of bitumen prices was 485-545 USD.
On July 15, bitumen prices in India rose by 1.5 USD. Despite the monsoon season, bitumen prices in India are expected to remain stable or see a slight increase on August 1.
Conclusion
After months of stability, bitumen prices in Iran are trending upward. With the increase in vacuum bottom base prices on Saturday, rising domestic costs and international transportation costs from Bandar Abbas, and the decrease in the US dollar’s value against the Iranian rial, an increase in bitumen prices in Iran is likely.
