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BUNKER INDEX :: Price Index, News and Directory Information for the Marine Fuel Industry
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Global Vision Market Report
Trading Team, Global Vision Bunkers B.V.
03 Nov 2015 13:26 GMT





Global Vision Bunkers BV logo. Oil prices at ICE and NYMEX rose modestly in East Asia and early electronic trading but could not breach their key resistances. The latest Baker Hughes rig count lent some support, as the number of active U.S. oil rigs dropped again last week, while disappointing indicators in China, where the manufacturing sector weakened again, and news that Russian oil production hit a fresh record high in October, weighed. Adding to the bearish picture was Iran's announcement that the country would inform OPEC members about its production and export schedule on the occasion of the next meeting on December 4 in Vienna. Consequently oil prices at ICE and NYMEY dropped at the beginning of the European session and breached their first short-term supports. The MA 7 that limited oil's downside, was not hit. At the beginning of the session in New York oil futures rebounded on short covering, also driven by the good performance of equity markets and better-than-expected U.S. indicators. In the course of the session oil compensated most of its earlier losses, the G.Oil and the WTI even hit their MA 21 key resistances which limited the upside. At the end of the session prices lost ground again. While G.Oil finished at the opening level the Brent contract settled near the day's low. If the Stochastic's two lines have converged at the G.Oil and the WTI chart the indicator will not produce a selling signal unless the lines cross. At the Brent chart the Stochastic has already produced a bearish signal. If such signals are also triggered for the G.Oil and the WTI a strong technical downward correction would be released. However, for the time being the key supports (MA 7) and the key resistances (MA 21) are still intact and limit oil's margin. Despite the selling signal the Stochastic produced at the Brent chart we consider the technical constellation still as neutral as a breach of the MA 21 would trigger a bullish signal.

ICE Gasoil contract for November delivery settled at 455.25 USD on Friday, this is 1.75 USD below Friday's settlement. With some 35,500 deals the traded volume (front month) was below average.

Russia's oil output hit a fresh record high in October, the Chinese manufacturing sector and thus oil demand growth is slowing while Iran is set to raise its oil exports and seasonal maintenance at the Buzzard oil field has been reported again. This is a combination of bearish factors that limited oil's upside on Monday and is expected to do so today. Tim Evans, analyst with Citigroup, believes that investors have meanwhile priced in the fact that the market continues to be oversupplied, otherwise yesterday's downward movement would have been stronger, according to his assessment. If this is partly true, uncertainties still remain as concerns oil demand and the additional barrels from Iran.

Global economic indicators signal weak oil demand growth. If, according to the EIA oil demand in 2015 exceeds 2014 demand by 2.25 mb/d, in 2016 demand growth is only seen at 0.43 mb/d compared to 2015. Oil prices are thus seen declining again, the price for a barrel of WTI or Brent seen falling below 40 dollars should OPEC not decide to cut output, analysts say. The additional barrels from Iran will strongly weigh on global oil prices as the other producers would be forced to reduce their prices if they refrain from reducing output. One will have to wait and see if Tehran will be able to increase production by 0.5 mb/d within one month. The new potential will have a medium- to longterm impact on oil prices as supply and demand at the global oil market will take much longer to be balanced, commented Gao Jian, analyst with SCI International. Market participants today and tomorrow will eye the weekly oil inventory reports that are expected to show another 2.5 million barrel build in U.S. crude stocks. While refinery run rates should have increased refined product stocks are seen lower due to an increase in seasonal demand which will presumably not be fully compensated by the higher utilization rate.

U.S.

Nymex: After a modest rebound in Asian trading this morning oil futures extend their losses in early electronic trading, penalized by the latest bearish fundamentals in a market still looking for direction. The traded volume at NYMEX is on average this morning. Investors are waiting for the European financial and forex markets to open, as well as for the release of some U.S. indicators in the afternoon and of the API's report on U.S. petroleum inventories tonight at 10.30 p.m.

Houston (ex-wharf indications 3-11)
380cst $230.50
180cst $274.50
MGO $473.50

New Orleans (ex-wharf indications 3-11)
380cst $241
180cst $297.50
MGO $471.50

Singapore (delivered indications 3-11)

Brent is losing again with -$0.69 for December contracts. Singapore paper is following with -$4.05 for 180cst with -$4.05 for 380cst for Nov, and for Dec 180 cst -$4.15 and 380cst with -$4.20 with MGO contracts Nov following with -$0.22 and in Dec with -$0.29. The cargo market is now reacting with 180cst -$3.15, 380cst down with -$2.93 and MGO with +$0.18.

380cst $238
180cst $250
MGO $439

Fujairah (delivered indications 3-11)

380cst $245
180cst $278
MGO $613

ARA (Amsterdam - Rotterdam - Antwerp)

Indications for delivered bunkers:
380cst : $220
MGO 0.1%S: $419


Related Links:

Company: Global Vision Bunkers B.V.

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