Bitumen market and petrochemical had a relatively inactive market in the 2nd week of July. Traders are nearly uncertain about every bit of detail and new decisions. The uncertainty comes from the new situation in the market caused by the fear of recession.
In the Middle East, bulk bitumen is currently in the range of $ 340 – $ 350 and the new steel drum is fluctuating in the range of $ 420 – $ 425. Prices have decreased from about $ 10 to $5 because of the effect of crude and the demand of the market.
In China, the struggle with covid is still continuing. The country is forced to shut down its cities and financial activities due to the zero-covid policies. The demand outlook is not clear but experts believe that it can increase by the gradual restrain of the virus.
Covid is erupting in other countries as well. The situation is not an emergency but authorities are cautious about the situation to avoid making a global crisis once again. The fourth dose of vaccination is available in countries.
Crude oil and recession fear to look to have the most effect on the market at the moment. Increasing interest rates in several countries including the US are causing a fear regarding a coming recession.
The Federal Reserve knows that there will be consequences to increasing interest rates but they believe that it will be better. The inflation that was stimulated after the covid lockdowns are getting bigger and bigger gradually. By taking no action, the US will soon face hyperinflation such as in the 70s when the oil price hit the highest price itself. Therefore, they see recession as nearly controllable.
This article was prepared by Mahnaz Golmohammadian, the Content specialist and market analyst of Infinity Galaxy.