Bitumen Market Faces Mixed Trends Amid Weak Demand, Geopolitical Risks

Bitumen Prices Overview

Demand and Supply Dynamics

East Asia (Singapore & South Korea)
Bitumen demand remained subdued amid ongoing rainy weather and slow construction activity. Supply remained sufficient, prompting sellers to reduce prices marginally to stimulate sales. Refineries maintained stable output levels, though storage buildup was reported in certain ports due to slower off-take.

India
The Indian bitumen market continues to face a seasonal lull. Heavy monsoon rains stalled road and infrastructure projects across several states, resulting in minimal procurement activity. Traders and refineries are likely to maintain current price levels until project resumption post-monsoon.

Europe
The European market displayed contrasting regional trends. While the Mediterranean region witnessed a notable $20 increase due to tighter supply and renewed buying interest, Central and Eastern Europe saw price corrections driven by oversupply and limited downstream consumption. This divergence highlights the growing influence of local factors over global sentiment.

China
Slight recovery was noted along the East Coast, where improved weather and easing rainfall spurred minor restocking activity. However, overall demand remains lower than last year’s seasonal average, keeping prices from rebounding strongly.

Iran
The reactivation of U.N. sanctions against Iran, coupled with currency devaluation and logistical constraints, has created challenges for exporters. Limited access to international markets and high political risk have disrupted trade flows, forcing some producers to reduce export offers to sustain competitiveness.

News and Market Developments

• Trump-Netanyahu Peace Proposal: A 20-point plan to resolve the Gaza conflict raised geopolitical uncertainty in the Middle East, influencing oil market sentiment.
• U.N. Sanctions on Iran: The reimplementation of sanctions through the Snapback Mechanism added pressure to Iran’s petrochemical and bitumen exports, weighing on supply confidence.
• Ukraine Drone Strikes on Russian Refineries: These attacks temporarily disrupted Russian oil supply, although higher export volumes from western ports offset the impact.
• U.S. Federal Government Shutdown: The shutdown halted key energy and economic data releases, creating uncertainty in global trading decisions and limiting price transparency.
• OPEC+ Supply Concerns: Signals of potential production hikes by OPEC+ and resumption of Kurdistan exports raised fears of oversupply in the global crude market, indirectly pressuring bitumen prices.

Market Expectations

• Bitumen prices are expected to remain under mild downward pressure in the short term as demand recovery is slow, especially in Asia. However, any escalation of geopolitical risks could lend temporary price support.

India
Post-monsoon demand revival from infrastructure projects is anticipated to stabilize the market from late October onward.

East Asia
Weather normalization and gradual project restarts could lead to slight improvements in trading activity, though oversupply remains a concern.

Europe
The Mediterranean market may sustain its strength in the near term due to tighter supply, while Central and Eastern Europe could witness further correction until stock levels normalize.

Iran
Continued sanctions and exchange rate volatility are expected to keep the market fragile, with limited export flexibility.