Bitumen Market Update: U.S. Policies and Iraq’s Oil Production Impacting Prices

Key Highlights:

1. Price Trends – Global bitumen prices saw mixed movements; Iranian bitumen rose, while Singapore and South Korea remained stable.
2. Supply Shifts – Iraq to export 185,000 bpd to Turkey, impacting global supply.
3. Market Influences – U.S. tariffs on European goods and Ukraine-related policies affecting energy markets.
4. India’s Demand – Remains strong, but future price trends are uncertain.
5. Industry Contracts – Agarwal Industrial Corp signs a ₹303 crore deal with BPCL for VG30 & VG40 bitumen supply.
6. Market Outlook – Volatility expected; Indian prices may see corrections in early March.

Crude & Bitumen Prices: Fluctuations Amid Market Uncertainty

• Crude oil prices fluctuated throughout the week, initially falling due to increased oil export expectations from Iraq, followed by a recovery on Thursday when prices reached $72.24 per barrel. 
• Singapore’s 180CST bitumen price dropped to $473, while bitumen prices in Singapore and South Korea remained stable at $449 and $425, respectively. Bahrain’s bitumen price stayed fixed at $420, while European bitumen prices traded between $440-470. 
• The Indian bitumen market showed no clear trend for March 1, but a potential price drop is anticipated due to uncertain market conditions. In Iran, bitumen prices rose over the past week, driven by a widening free-market dollar rate gap and increasing competition among producers for raw materials.

Iraq’s Export Plans Raise Oversupply Concerns

• Bitumen market dynamics remain influenced by geopolitical developments and global crude supply trends. The U.S. is pressuring Iraq to resume oil exports, leading to an expected increase in global supply. 
• Iraq has announced plans to transfer 185,000 barrels per day of crude to Turkey, raising concerns about oversupply and affecting short-term prices. 
• Meanwhile, U.S. tariffs on European goods and shifting policies regarding Ukraine’s security funding are impacting energy markets. 
• India's demand for imported bitumen remains high, though price trends remain uncertain. In Iran, exporters are accelerating shipments before the Persian New Year, causing port congestion and temporary supply disruptions.
• Agarwal Industrial Secures ₹303 Cr Bitumen Supply Deal with BPCL. Agarwal Industrial Corporation has signed a supply agreement with Bharat Petroleum Corporation (BPCL) for bulk bitumen.
• Under the agreement, the company will supply 45,000 MT of VG30 bitumen and 30,000 MT of VG40 bitumen to BPCL.
• The initial contract period is one year, with the possibility of a one-year extension at BPCL’s discretion. The total contract value amounts to ₹303 crore.
• Agarwal Industrial Corporation is involved in bitumen manufacturing, LPG transportation, bituminous product supply, and ship operating and chartering through its UAE subsidiary.

Market Expectation: Price Corrections Expected in March

In the short term, oil prices are expected to remain volatile, with global supply shifts and geopolitical tensions playing a key role. Iraq’s increased exports and U.S. trade policies will likely keep supply ample, while Iran’s market is expected to see gradual price increases due to strong domestic demand. The Indian market remains unpredictable, with potential price corrections expected in early March.