In the previous week, there was a supply of 160,000 metric tons (MT) of VB in the IME, and the regis- tered demand was 280,000 MT. This represents a decrease in supply compared to the prior week, with a reduction of 27,000 MT. As a result, all of the available supply was sold, leading to a weekly fluc- tuation rate for VB ranging from -7.1% to 10.9%. The reduction in supply was primarily due to halt- ed production from Shiraz and Abadan refineries. Notably, VB from the Arak refinery saw the highest increase at 10.9%, and the ratio between VB’s clos- ing price and IME’s export bitumen price reached 95%. The average value of VB in the Free Market USD was assessed at $285. Additionally, the value of VB in the Center of Exchange Dollar reached $341.

In the IME’s export market, where approximately 66,500 metric tons (MT) of supplies were available, exceeding the previous month’s average by 3,700 MT, various bitumen types were offered. The prices for these bitumen types were as follows: Isfahan Jey Oil Bulk Bitumen was priced at around $310, con- sidering the free market USD to IRR exchange rate, while Bandar Abbas Pasargad Oil Bulk Bitumen was available at $319 per MT. Additionally, Bandar Ab- bas Pasargad Oil Drum Bitumen was priced at $378 per MT, Arak Pasargad Oil Bitumen at $296 per MT, and Pars Behin Qeshm Oil offered bitumen at $295 per barrel. Despite the increased supplies, demand fell short, and not all offered quantities were traded.

In correspondence with the Ministry of Oil, the Cen- tral Bank has conveyed its decision to utilize the ex- change rate set by the Central Foreign Exchange and Gold Center as the benchmark rate for pricing feed- stock and establishing base prices for commodities traded on the commodity exchange by oil refining and petrochemical companies. This directive aligns with the guidelines outlined in letter number 591/1402, dated 09/01/1402, which specifically addresses the calculation of exchange rates for these purposes.

An important memorandum of understanding (MoU) has been officially inked between the Shiraz Oil Re- fining Company and Exir Novin Asia. This significant agreement aims to address the sulfur reduction issue within the furnace oil production process at the Shi- raz refinery. The primary goal here is to substantially reduce the sulfur content in the furnace oil produced at this facility, which ultimately enhances the over- all quality of the petroleum products manufactured there. Notably, the CEO of the National Iranian Oil Refining and Distribution Company had recently her- alded the country’s achievement of advanced techni- cal expertise in the field of sulfur reduction within the realm of refining industries. This MoU marks a strate- gic step towards realizing this technological prowess in practical applications within the Shiraz refinery

DOWNLOAD LINK

In the latest week, the Iran Mercantile Exchange (IME) witnessed the supply of 188,000 metric tons of Vacuum Bottom (VB), marking a notable increase of 27,000 metric tons compared to the prior week. All the supplied VB found buyers, and throughout the week, the prices experienced fluctuations rang- ing from -4.2% to 6.8%. This surge in supply can be attributed to increased production from all refin- eries. The Tabriz refinery’s VB recorded the most significant price increase, surging by 6.8%. The clos- ing price of VB relative to IME’s export bitumen reached a level of 90%. In terms of valuation, VB averaged $277 in the Free Market USD, with its val- ue on the Center of Exchange Dollar reaching $332.

In the IME’s export market, approximately 57,000 met- ric tons of bitumen were available, which was slight- ly less than the preceding month’s average by 7,100 metric tons. This reduction in supplies was attributed to fewer offers from suppliers. However, despite the decrease in supply, the total amount of outputs was fully traded. Demand in this market reached 64,050 metric tons, surpassing the available supplies. The negotiated equivalent rates for Isfahan Jey Oil Bulk Bitumen were in the range of 317$ to 347$. Mean- while, the prices for Bandar Abbas Pasargad Oil Bulk and Drum Bitumen were 319$ and 378$, respective- ly. Additionally, Arak Pasargad Oil offered Bulk and Drum Bitumen at rates of 346$ and 386$, with Arak Pasargad oil priced at 321$. Pars Behin Qeshm Oil’s bitumen was available at a rate of 281$ per barrel.

In a communication dated June 22, 1402, the Iran Commodity Exchange has officially notified a modification in the advance payment rate for the procurement of vacuum bottoms. Effective from June 26, 1402, it has been decreed that the ad- vance payment rate for purchasing vacuum bot- toms on the Iran Commodity Exchange will stand at 10%, pending any subsequent updates. Prior to this adjustment, the advance payment rate for vac- uum bottoms acquisition was established at 20%.

In early September, the Union of Oil, Gas, and Pet- rochemical Product Exporters approached the Cen- tral Task Force for Combating Smuggling of Goods and Currency with a request. They sought favor- able conditions that would allow manufacturers to transport their export shipments of various oils and lubricants using flexi-tanks. The idea was to enable these producers to move their export cargo from the factory to the customs office using tanker trucks. Once the tanker was sealed at the customs office, these trucks would then proceed to the export ports. There, under the watchful eye of customs officials, the cargo in these tanks would be transferred to flexi- tanks. In response to this proposal, the Task Force for Combating Smuggling of Goods and Currency elaborated on the reasons behind the prohibition of transporting oil products through flexi-tanks. Ac- cording to their explanation, customs sampling is performed on the final container of the cargo. Due to concerns about potential tampering or confisca- tion during this process, it was determined that this procedure is not feasible. Consequently, a meet- ing will be convened at the customs office, involv- ing stakeholders, to delve further into this matter.

DOWNLOAD LINK

During the past week at the Iran Mercantile Exchange (IME), there was a notable surge in the supply of vacuum bottoms (VB), totaling 190,000 metric tons. This represented a robust 7.56% increase compared to the preceding week. The prior week also witnessed an uptick in supply, rising by 2,000 metric tons. Im- portantly, the entire supply was successfully traded, and throughout the week, VB prices experienced amodest fluctuation rate ranging from -1.2% to 1.3%. The increased supply was primarily attributed to heightened production from refineries in Tabriz and Isfahan. Furthermore, during this period, Tehran and Bandar Abbas VBs exhibited the most substantial price increases, registering a rise of 1.3%. The ratio between VB’s closing price and IME’s export bi- tumen reached 86%. VB’s average valuation in the Free Market, denominated in USD, was appraised at $277. Additionally, the value of VB in the Cen- ter of Exchange Dollar achieved a level of $331.

Supplies within the Export Market of the Iran Mer- cantile Exchange (IME) reached approximately 134,000 metric tons, indicating a substantial sur- plus of 67,900 metric tons compared to the previous month’s average. This remarkable increase in supply can be attributed to a significant uptick in offers from Jey Oil, Bandar Abbas, Arak Pasargad Oil, and Pars Behin Qeshm Oil. The substantial supply was met with robust demand, as 152,780 metric tons were registered, surpassing the available supplies. Taking into account the prevailing free-market exchange rate between USD and IRR, the negotiated equiva- lent rates for Isfahan Jey Oil Bulk Bitumen ranged between $307 and $317. The prices for Bandar Ab- bas Pasargad Oil Bulk and Drum Bitumen were re- corded at $340 and $392, respectively. Additionally, Arak and Tabriz Pasargad Oil Bitumen were priced at $311 and $339, respectively. Pars Behin Qeshm Oil’s bitumen was quoted at $321 per metric ton.

The Chairman of the Parliament’s Construction Commission and the Chairman of the Expediency Council convened a meeting to discuss the incor- poration of parliamentary representatives’ views into the proposed bitumen hedging law. During this meeting, they aimed to highlight the positive impacts of the bitumen hedging proposal and clar- ify any uncertainties or questions surrounding it.

The executive head of the Tehran City Engineer- ing and Construction Organization has announced the distribution of nearly 900,000 tons of asphalt on both major and minor roads in the capital city. This significant allocation addresses the city’s on- going need for asphalt, which exceeds 1.5 mil- lion tons annually. Notably, previous years saw asphalt production ranging between 300,000 to 500,000 tons, underscoring the substantial ef- forts to meet Tehran’s infrastructure demands.

The Iranian Customs Administration has issued a circular (notification number 84/1402/853451, dat- ed September 17) that enforces a ban on the trans- portation and export of petroleum products utiliz- ing flexi-tanks. This prohibition came into effect on May 30, 2023. As a result, the use of flexi-tanks for the conveyance and export of petroleum prod- ucts is no longer authorized, and export declara- tions will not be accepted starting from this date

DOWNLOAD LINK