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Bunker Global Free Directory

Bunker Global Open Directory News

2020-07-28

Bunker Market this morning, Jul. 28.

Oil rises on hopes for U.S. stimulus measure.

Oil prices rose on Monday on hopes that stimulus efforts will help revitalize the U.S. economy, but the gains were capped by rising coronavirus cases and tensions between Washington and Beijing.

Brent crude LCOc1 rose 7 cents to settle at $43.41 a barrel, while U.S. West Texas Intermediate (WTI) crude CLc1 rose 31 cents to settle at $41.60 a barrel.

U.S. Senate Republicans were expected to unveil a new $1 trillion coronavirus aid package on Monday afternoon.

“If we can put more money into the pockets of consumers, they’re going to spend it on goods and services,” said Phil Flynn, senior analyst at Price Futures group in Chicago. “That should lead to more gasoline demand, more travel and more shopping.”

A weak U.S. dollar, which makes dollar-denominated commodities cheaper for holders of other currencies, also helped boost oil futures. The U.S. dollar index .DXY reached its lowest level since June 2018, hurt by domestic economic concerns and deteriorating U.S.-China relations.

The renewed tensions between the world’s two largest economies following the closures of consulates in Houston and Chengdu have sent investors to safe havens, such as gold and bonds, and away from riskier assets like oil futures.

‘Meanwhile, global cases of the new coronavirus exceeded 16 million, and the virus is surging in areas of the United States.

While oil demand has risen after plunging in the second quarter, reimposed lockdowns because of rising infection rates have made the recovery uneven.

Brent remained on track for a fourth straight monthly gain and WTI was set to rise for a third month as supply cuts from the Organization of the Petroleum Exporting Countries and Russia provided support.

Today Tuesday oil prices started irregularly despite U.S. stimulus hopes, weaker U.S. dollar.

Oil prices are irregular on Tuesday start waiting for direction, like support for demand coming from efforts to stimulate the U.S. economy’s recovery from the coronavirus crisis and a weakening of the dollar that makes crude cheaper for global buyers.

U.S. Senate Republicans on Monday proposed a $1 trillion coronavirus aid package worked out with the White House to revitalise the economy with expanded unemployment benefits for millions due to expire this week, although Democrats urged more support.

“Oil prices will continue to draw support from the Fed’s dovish policy, which sees the U.S. dollar move lower,” AxiCorp market strategist Stephen Innes said in a note.

The U.S. dollar dropped to its lowest in nearly two years against a basket of six other major currencies on the back of a surge in U.S. coronavirus cases. Florida and California have now both overtaken the previous epicentre, New York.

“For oil prices to break out higher, there must be a significant flattening of the U.S. Sunbelt COVID-19 case count curve at a minimum,” Innes said.

Traders will be watching out for U.S. inventory data due from the American Petroleum Institute industry group later on Tuesday and the government on Wednesday. Refined products stockpiles are expected to have declined last week, while crude oil stockpiles are expected to have held steady, five analysts polled by Reuters estimated.

On the down side for fuel demand, Europe’s largest low-cost airline, Ryanair, on Monday cut its annual passenger target by a quarter after bookings were hit in recent days, and warned a second wave of COVID-19 infections could lower that further.

Oil Future close 27th July, 2020

Brent crude: $ 43.41 (+0.07) /brl FM delivery Sep

Light crude (WTI): $ 41.60 (+0.31) /brl FM delivery Sep

Gasoil ARA; $ 370.00 (-4.75) /mton FM delivery Aug

NY Harbor Ulsd: $ 386.09 (-0.67) /mton FM delivery Aug

Market is still at a standstill, waiting for direction. Yesterday the oil market was irregular and it could very well be the same situation today.

We expect bunker prices will not show any significant changes today and may move irregular in a range of plus-minus 2-4 USD.

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