The bitumen market did not withstand any significant turbulence during the second week of July. Prices were almost steady in all countries, including the Middle East. Iran’s vacuum bottom price is expected to rise in the next half of the month. However, these expectations did not affect the market during the week.
Crude oil hit surprisingly high after the disagreement of the OPEC meeting. Saudi Arabia did not consent to the UAE request. UAE is missing a huge part of its oil production capacity since the 2020 agreement of OPEC to tight the supply. The country does not want to make these deep cuts, but Saudi is afraid to let one oil producer looser. If the group cannot solve the issue, lower oil prices will be expected for the next year.
The demand is rising higher, but the supply has encountered several issues. New strains of Covid have risen in many regions, and countries are implementing new restrictions. Scientists believe that the vaccine may not have any effects on the newest variant; however, they are not still assured. The current situation has frightened governments and central banks about another coming disaster. Besides the covid danger, the oil price is a burden for producers and manufacturers of related industries. If crude keeps soaring higher, they will not be able to supply first raw materials. Without raw materials, the market will gradually face oil products shortages.
The construction programs have started in many regions, and they are expanding road construction and highways network. The consumption of raw construction materials such as bitumen, cement, binders, and bituminous membranes are increasing quickly. If the refineries and producers stop production, inflation hit the markets
This article was prepared by Mahnaz Golmohammadian, the Content specialist and market analyzer of Infinity Galaxy