On September 6th, once more, the price of oil rose during Asian trading due to concerns in the market about a supply shortage caused by Saudi Arabia and Russia extending their voluntary production cuts until the end of the year.
The futures quotes for crude oil reached 90.18 USD per barrel, marking a 14-cent increase, while WTI settled at 86 USD per barrel, reflecting an 81-cent increase.
Investors had anticipated that Russia and Saudi Arabia might extend their voluntary cuts only until the end of October, so the unexpected three-month extension had a significant impact. Jorge Leon, the Senior Vice President at Rystad Energy, stated that these bullish moves would greatly tighten the global oil market, resulting in higher oil prices worldwide. He also added that the impact on inflation and economic policies in the West is uncertain but could lead to fiscal tightening, particularly in the U.S., to combat inflation.
Meanwhile, the U.S. Energy Information Administration reported that U.S. crude oil production in June had reached its highest level since February 2020, a measure taken to prevent further increases in crude oil prices.
On the other hand, the production status of Chinese factories remains less than desirable, hindering improvements in oil prices. However, OPEC+’s actions to boost prices led to some growth in the crude oil market in recent weeks, which could have long-term negative effects on the global economy.
In Europe, it was reported that the inflation rate had reached single digits for all 20 Euro region members for the first time since November 2021, a span of 21 months.
Over the past week, Singapore’s HSFO CST180 saw two significant increases, reaching 528 USD. After weeks of stability, Singapore’s bulk bitumen price surpassed 500 USD, while South Korea’s bitumen price settled at 430 USD, and Bahrain’s remained fixed at 440 USD.
Bitumen prices in Europe experienced a slight increase. In India, there are reports that bitumen prices will rise by approximately 10 USD on September 15th, following a price surge observed on September 1st. This marks the second consecutive month of increasing bitumen prices in India.
After a period of recession in the Iranian market, the base price of all petrochemical products increased by around 38% due to a decision by the IME, significantly altering market conditions for the Middle East’s largest producer. Additionally, refineries engaged in unexpected competition, with prices increasing by up to 45%. Consequently, bitumen prices in Iran rose once again.
Given the shortage of containers, the end of the monsoon season in most markets, the surge in crude oil prices to 90 USD, and intense competition among manufacturers, it appears that we should anticipate rising bitumen prices in all markets.
This article was prepared by Shirin Yousefi, the Content specialist and market analyst of Infinity Galaxy