News
Oil Has Best Week in Four Months With Saudi Cut Buoying Prices
Oil posted the biggest weekly gain since late September as Saudi Arabia’s plan to slice output spurred a surge in physical crude buying.
Futures in New York advanced $3.72 this week and Brent oil topped $55 a barrel for the first time since February. Saudi Arabia’s pledge earlier this week to cut production by 1 million barrels a day in February and March has made for a tighter supply outlook sooner than anticipated. Meanwhile, prospects for additional stimulus under a Biden administration spurred broader market gains.
Saudi Arabia’s surprise cut appears to have caught some Asian buyers by surprise and demand for U.S. crude for export to Asia has gained this week. Unipec, the trading arm of China’s largest refiner, bought its eighth cargo of North Sea crude in a pricing window run by S&P Global Platts this week and was seeking more in what may be the heaviest buying of its kind on record.
“The decision by the Saudis was a big deal and it’s an underpinning for prices,” said Bill O’Grady, executive vice president at Confluence Investment Management in St. Louis. “Clearly, maintaining the oil price was paramount and they were willing to let others take advantage in order to accomplish that.”
Brent’s move above $55 a barrel caps a stellar few months for the oil market, with crude emerging as a favored play to bet on coronavirus vaccines and global reflation. Saudi Arabia’s pledge has led analysts to rethink their projections for crude’s price recovery. Citigroup Inc. boosted its price forecasts on Friday, saying the kingdom’s actions should accelerate stockpile draws.
Meanwhile, annual commodity index rebalancing may provide another tailwind, with as much as $9 billion of oil contracts possibly being bought over the five days of activity that start Friday, Citigroup said.
“It is likely that much of the commodity index buying has been prepositioned for,” so it would not come as a surprise “to see counter-intuitive price action occur next week,” Ryan Fitzmaurice, commodities strategist at Rabobank, said in a note. “But we still expect commodity markets to attract more attention this year even beyond the rebalance as a weak U.S. dollar and increased fears of inflation bring the alternative asset class back in vogue.”
The kingdom’s shock move has rippled across the oil market this week, with the difference between the price of oil for different months firming markedly in recent sessions. WTI’s nearest contract traded at a premium to the following month for the first time since May, while the closely watched spread between the nearest two December contracts is at its strongest intraday level since last January.
There are also bright spots for consumption in spite of the coronavirus as the northern hemisphere faces a freezing winter. Beijing’s coldest weather since 1966 is pushing local energy prices higher and temperatures across much of Europe and Asia are expected to stay below average for most of January.
Source: www.bloomberg.com; Andres Guerra Luz
Other News by Category
General Shipping & Maritime
-
Port of Rotterdam Reports Success in Bunker Spill Cleanup
-
Day of the Seafarer: Mental Wellbeing in Focus
-
Posidonia 2018: 5 Most Exciting Things to Watch Out for in Shipping Industry
-
North Korea's High-Seas Fuel Smuggling Continues
-
Meyer Turku hands over new-design Mein Schiff 1
-
92% Of Seafarers Strongly Influenced By Internet Access – Futurenautics
-
Container ship MSC Kia Ora banned from Australian ports
-
Carnival to increase capacity on short cruise program with arrival of Carnival Dream in 2019
-
LNG cruise ships herald new era of training
-
Kinder Morgan takes delivery of 4th tanker from Philly Shipyard
Safety & Piracy
-
Three Killed, Five Missing After Two Ships Collide Near Shanghai
-
Oil tanker hit by blast at Saudi terminal, Saudi Arabia confirms
-
AMSA To End Permit That Allowed Seafarers To Work Longer Than 11 Months On Board Ships
-
Pirates Kidnap 19 in Two Separate Incidents in Gulf of Guinea -Dryad
-
ONE Containership Diverted to Tacoma Due to Collapsed Containers
-
Container Incident in Bristol Channel
-
Australia Evacuates Crew from Coronavirus-hit Livestock Carrier
-
Here’s One Way To Avoid COVID19 – Set Your Ship Adrift In Arctic Ice
-
Containership with Cracked Hull Leaking Fuel Oil in Bayonne, NJ
-
ICS, UNHCR and IOM call on States to end humanitarian crisis onboard ship in the Mediterranean
Maritime Economy
-
X-Bow Design Could Help Solve Air Draft Challenges for Boxships
-
How Eastern Pacific Shipping Achieved its CO2 Target Two Years Early
-
Dutch Seafarers Threatened With Dismissal Petition Maersk Shareholders For Help
-
Sailor Dies, 3 Injured on Bulker in Atlantic Storm
-
Cargo Boom Continues at Nation’s Second-Busiest Port
-
Japan’s MOL Scraps its Oldest LNG Carrier in Fleet Modernization
-
Maersk Essen Arrives in Mexico with Collapsed Containers
-
Steel cutting commences for Proman Stena Bulk’s methanol-fuelled tanker
-
World’s Largest VLEC Departs Texas with Record Shipment to China
-
Port of Long Beach Reports Busiest Year in 2020 Despite Headwinds
Environment & Technology
-
A.P. Moller- Maersk, The Ocean Cleanup extend relationship with new three-year partnership
-
Top charterers agree to publish shipping emissions data
-
MSC Sees Hydrogen And Biofuels As Key Components Of Shipping’s Future Fuel Mix
-
Storm-weary U.S. energy producers, refiners prep for hurricane strike
-
In Just 20 Years, Ships Could Cross an Open Arctic Ocean
-
As Arctic Ice Melts, Polluting Ships Stream Into Polar Waters
-
Hapag-Lloyd to lower CO2 emissions using biofuel
-
GLOBAL: NEW REPORT CLAIMS LNG AS MARINE FUEL IS ‘WORSE THAN BUSINESS AS USUAL FOR THE CLIMATE’
-
Study: New Blends of Marine Fuels Have Higher BC Emissions than HFO
-
New Report Identifies Clean Energy Options for Global Shipping Industry
Offshore, Oil & Gas
-
Rise in New Southeast Asia Upstream Players
-
Iraq looks to rebuild tanker fleet, eyes crude oil sales on delivered basis
-
Interview: Methanol Is Ready for Use as Marine Fuel
-
Chevron Announces Gorgon Expansion
-
Interview: What Will Be THE Marine Fuel of the Future?
-
Skangas Celebrates Milestone with 1,000 LNG Bunkering Operations in 2017
-
New LNG Carrier Design Suits “Milk Run”
-
Japan Commissions Oil Tanker To Combat Chinese Presence In East China Sea
-
Danish Energy Agency Clears Maersk Oil Sale
-
Offshore architects diversify and look to new roles for existing designs
Port & Shipbuilding
-
Bulk Shipping Comes Back to Oakland Port
-
Port of Newcastle to become the first Australian port to join the International EcoPorts network
-
CSP Abu Dhabi Terminal opens at Khalifa Port
-
North Sea Port: We Are Ready to Invest in Hydrogen as Fuel
-
Port Awarded $50 Million for Zero Emissions Project
-
New container terminal planned for Port of Newcastle
-
Port of Gothenburg Adds LNG Bunkering Option
-
China’s conquest of European box ports
-
Damen acquires Daewoo’s Mangalia yard
-
ICTSI approves Iraq’s BGT development
Events & Press Releases
-
Nakilat records 13% increased profits for the first quarter of 2018
-
Cargo throughput of UCL Holding’s stevedoring division rises 9% to 37.1 million tonnes
-
International Sea Ports and Maritime Authorities Gather in 2 Weeks to Discuss Port Security Technology
-
Hydropower Balkans 2017
-
Hydropower Balkans 2017 - Free Webinar
-
Speaker Line Up is Announced for the Maritime Big Data Forum at Nor-Shipping on 30 May
-
Sea Asia 2017 Reinforces Role as Leading Maritime Forum in Southeast Asia
-
10th International Fujairah Bunkering & Fuel Oil Forum: Event Summary
-
Counter-Terrorism Measures at Ports
-
DHT Holdings, Inc. announces delivery of first VLCC from BW Group
National (Croatian)
-
Uljanik plovidba ulazi na tržište prijevoza ukapljenog plina
-
Hrvatska brodogradnja - poslovi vrijedni 1,9 milijardi dolara
-
Zanimanje po kojem je Hrvatska oduvijek bila poznata u svijetu potrebno je spašavati od izumiranja
-
Drama u Arapskom moru: Naš tanker iz Uljanika napali pirati
-
Luka Rijeka planira od ulagača privući 300 milijuna kuna
-
Uljaniku i »3. maju« gradnja 20 brodova u idućih 15 godina
-
Floti Jadrolinije priključen brod „Mljet“
-
Jadroliniji prijete tužbe teške 20 milijuna kuna
-
U lovu na konkurente: Rijeka raste, ali promet luke u Kopru i dalje je četiri puta veći
-
Treća novogradnja u seriji, brod „Krk“ svečano priključen floti Jadrolinije