Base Oil Report
Oil markets have shown tremendous weakness in recent days. What’s causing it? Market analysts have been struggling to find a single reason for it, preferring to cite a cocktail of negative news and rumour to explain the downdraft.
There have been reports of increased Saudi production to Asian customers, which many cite as a breaking of the dam of OPEC production guidelines – a break that would have many in the oil world in full panic mode.
Te Asian contracts are merely adding stability to the oil markets in front of the threats of renewed U.S. sanctions on Iran. Te announcement that China and India are considering forming an “Oil Buyers Club” to counter the market power of the Organization of Petroleum Exporting Countries is proof that the run-up in oil prices this year, from $30 a barrel to $80, is happening in a very different context than spikes of the past. Te proposed alternative to OPEC could be good news for importing nations' economies and the environment.
| Month | Group I - SN 500 Iran Origin | Group II -J-150 Singapore Origin | N- 70 South Korea Origin | Rubber Process Oil Drums Iran Origin |
|---|---|---|---|---|
| May 2018 | 850 – 860 | 825 – 840 | 785 – 795 | 500 – 510 |
| June 2018 | 840 – 850 | 815 – 830 | 775 – 785 | 490 – 500 |
| July 2018 | 840 – 850 | 815 – 830 | 775 – 785 | 490 – 500 |
| Since January 2018, prices have gone up by in July 2018 | USD 60 PMT (8%) | USD 50 PMT (6%) | USD 67 PMT (9%) | USD 35 PMT (8%) |
