WEEKLY REVIEW OF BITUMEN MARKET IN THE WORLD Date: Aug 06 2023
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- Category: News
- Published: Monday, 16 October 2023 09:36
- Written by Super User
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Last week, the Iran Mercantile Exchange (IME) witnessed a supply of 171,000 metric tons (MT) of VB (vacuum bot- tom), showing a decrease of 4.21% compared to the pre- vious week. Despite the decrease in supply, the demand remained robust, with a registration of 345,530 MT. In the prior week, the supply rate had grown by 23,000 MT, and the entire amount was sold, leading to fluctuations in VB’s weekly prices ranging from 0.7% to 3.5%. The increase in output volumes from the refineries in Tehran and Bandar Abbas has resulted in a significant surge in the amount of VB offers in the market. Among these refineries, VB from the Tehran refinery experienced the most substantial in- crease at 3.5%. Additionally, the ratio between VB’s closing price and the IME’s export bitumen reached 113%, indicat- ing a pricing relationship between these commodities. VB’s average value in the Free Market was assessed at USD 285 per metric ton, while in the Center of Exchange Dollar, VB’s value reached USD 347 per metric ton. These figures indi- cate the dynamic nature of the VB market in the IME, influ- enced by changes in supply, demand, and refinery outputs. The increase in output volumes from the Tehran and Bandar Abbas refineries has contributed to the higher supply levels and potentially influenced pricing dynamics. As the market evolves, participants will continue to closely monitor VB’s supply and demand trends, as well as pricing fluctuations, to make informed decisions in the volatile energy market.
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The prior week saw Pasargad Oil’s monthly financial state- ment being published on the Codal platform. According to the statement, during June and July, the company produced 50,000 metric tons (MT) of domestic bitumen and 55,000 MT of export bitumen. These figures represent a significant increase of 43% and 68% respectively, compared to the pre- vious month. In terms of product breakdown, the report in- dicates that domestic and export penetration grade bitumen experienced a decrease of 5% during June and July. On the other hand, domestic viscosity grade bitumen saw a signifi- cant 10% decline, and export viscosity grade bitumen expe- rienced an even larger plunge of 13% during the same pe- riod. These production and sales figures illustrate Pasargad Oil’s activity in the bitumen market, showcasing notable growth in both domestic and export production. However, the decrease in certain bitumen grades indicates potential fluctuations in demand or other market factors that may have influenced the sales volumes for those specific products
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In the IME’s export market, the supplies of bitumen were approximately 81,000 metric tons (MT), which was 43,800 MT higher than the average of the previous month. This increase in supplies can be attributed to offers from var- ious companies, including Jey Oil Bulk and Drum Bitu- men, Tehran Pasargad Oil, and Pars Behin Qeshm Oil. The total demand for bitumen in the export market was recorded at 145,300 MT, which exceeded the available supplies. Consequently, all of the supplied bitumen was traded. Considering the free market USD to IRR ex- change rate, at the published date, the bargained equiv- alent rate for Isfahan Jey Oil Bulk Bitumen was around 329$ to 332$. Prices for Bandar Abbas Pasargad Oil Bulk Bitumen was 343$. Furthermore, the rate for Tabriz and Tehran Pasargad Oil were 335$ and 345$ respectively. Pars Behin Qeshm Oil offer was also 305$ per MT. These prices are influenced by factors such as supply and de- mand dynamics, production costs, and exchange rates.
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The Iran Road Bitumen Association (IRBAS) has raised objections to the Road Maintenance & Transportation Or- ganization’s decision to prohibit specifying barter bitumen remittances to producers in the private sector. According to the Secretary of the association, the decision appears to be subjective, as it allows for bitumen remittances to be designated only to two state-owned companies, while excluding the private sector, which comprises 70 active firms. The IRBAS expresses concern over the exclusion of the private sector from this opportunity, as it could lead to an unfair advantage for a limited number of compa- nies and hinder fair competition in the bitumen industry. By limiting the remittance options to just a few entities, the proposal may restrict market access and opportuni- ties for private sector firms, impeding their growth and participation. The association stresses the importance of fostering an inclusive and competitive market environ- ment for the bitumen industry. They urge the Road Main- tenance & Transportation Organization to reconsider its decision and include all active firms in the private sector as eligible recipients of bitumen remittances. Ensuring equal opportunities for all participants will help promote a thriving and sustainable bitumen sector in the country
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