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Bunker Global Open Directory News

2020-10-09

MABUX: Bunker Market this morning, 9th October, 2020

Oil Market close, yesterday evening Thursday

Oil jumps on supply cuts in U.S. Gulf, wariness about North Sea, OPEC.

Oil settled above $43 a barrel on Thursday on support from output shutdowns ahead of a storm in the U.S. Gulf of Mexico and the possibility of supply cuts from Saudi Arabia and Norway.

Markets rose sharply at noon on a Dow Jones report that Saudi Arabia is considering reversing course over OPEC’s planned production increase early next year.

Brent crude settled up $1.35, or 3.2% to $43.34, after falling 1.6% on Wednesday. U.S. West Texas Intermediate (WTI) crude added $1.24 cents, or 3.1%, to $41.19 after falling 1.8% on Wednesday.

Oil also gained support from the prospect of more production outages in the North Sea because of a workers’ strike. Oil firms and labour officials said they will meet with a state-appointed mediator on Friday in an attempt both sides hope will bring an end to a strike that threatens to cut Norway’s oil and gas output by some 25%.

The Organization of the Petroleum Exporting Countries (OPEC) has been challenged by rising output in Libya, an OPEC member exempted from cutting output, as well as an increase in coronavirus cases in many areas of the world.

“If true, the Saudis’ decision rewards the cheaters in OPEC while acknowledging the demand challenges that are still here,” said Phil Flynn, analyst at Price Futures Group in Chicago.

“This potential extension of the cuts is definitely a positive for the markets and maybe provides the seasonal bottom that is happening anyway,” he said.

The market has also drawn support from Hurricane Delta, which is forecast to intensify into a powerful, Category 3 storm in the Gulf Coast. Nearly 1.5 million barrels of daily output was halted.

“Hurricane Delta is a crude oil supply event, and with all of this Gulf of Mexico production offline, we will probably lose more than 5 million barrels of crude oil due to the storm,” said Andrew Lipow, President of Lipow Oil Associates in Houston, Texas.

Oil Market today, Friday morning

Oil prices pause in week-long surge Norwegian strike drives strong gains.

Oil prices eased a few cents early in trading on Friday in a breather at the end of a week of big gains propelled by a strike in Norway that raised the prospect of supply from the major producer being slashed by up to 25%.

Brent was down by 9 cents at $43.25 a barrel by 0152 GMT, having gained more than 3% on Thursday. U.S. West Texas Intermediate (WTI) crude dropped 5 cents at $41.14.

Both contracts are on track for gains of around 10% this week - the first rise in three weeks - yanked higher by the prospect of tighter supply on production outages in the North Sea because of the action by Norwegian oil workers.

"This could see almost one million barrels a day of crude oil impacted," ANZ Research said in a note.

Norwegian oil company and labour officials said they will meet with a state-appointed mediator on Friday in an attempt both sides hope will bring an end to a strike that threatens to strip out about a quarter of the country's oil and gas output.

Elsewhere, market watchers are also bracing for the impact on U.S. production of Hurricane Delta, forecast to strike the Gulf Coast within hours. Nearly 1.5 million barrels of daily output has been halted so far.

Oil Future close 8th October, 2020

Brent crude: $ 43.34 (+1.35) /brl FM delivery Dec (FM=Front Month)

Light crude (WTI): $ 41.19 (+1.24) /brl FM delivery Nov

Gasoil ARA; $ 343.50 (+11.25) /mton FM delivery Oct

NY Harbor Ulsd: $ 367.06 (+9.70) /mton FM delivery Nov

Oil Futures trading at GMT 05.17; Brent: $-0.10, WTI: $-0.06.

Expect Oil prices steady today but increase of bunker prices based on Oil Future close last night:

Fuel Oil world-wide up 8-10 usd/mton. (When we say Fuel Oil, it means 380 HS plus VLSFO together).

MGO and NY Harbor Ulsd up 10-11 usd/mton.

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