Does the high international oil price have an impact on the market of break bulk ?
International oil prices have remained high amid continued geopolitical tensions and rising inflation. But recently, oil prices have plummeted. In June, New York and Brent futures fell nearly 8% and 11%, respectively. After the first monthly decline of the year, will international oil prices soar again?
There are several reasons for the recent drop in oil prices:
On the one hand, global central banks are tightening, investors are increasingly worried about a global recession and the outlook for crude oil demand is weakening, putting downward pressure on oil prices.
On the other hand, AT the 30th Ministerial meeting of Opec +, the Organization of Petroleum Exporting Countries (Opec) reaffirmed its previously announced production quota adjustment plan and decided to increase its crude oil production quota for August by 648,000 barrels per day, restoring nominal oil production to pre-epidemic levels.
International oil prices fell after the increase was announced.
Amos Hochstein, a top U.S. energy security adviser, said the United States hoped Opec + plans to increase production by 648,000 BPD in July and August would be the "first step" in its supply policy, followed by a "second step."
With consumers suffering from skyrocketing oil prices, the U.S. is eager to see prices cool. To this end, the United States has repeatedly released strategic crude oil to increase marginal supply and curb oil prices. With repeated outbreaks and rising inflation disrupting crude demand, U.S. gasoline demand is already showing signs of weakening and the market outlook is hardly optimistic, driving oil prices lower. Russia, for its part, increased oil production in June despite repeated sanctions. Russian oil production was reported to have increased by nearly 5% in June to 1.46 million tons per day (10.7 million barrels per day). This, combined with the fact that the market has largely priced in the impact of the western oil ban on Russia, has eased concerns about oil supply, further helping to cool prices.
The supply squeeze has intensified
In spite of the recent volatility in oil prices, the persistent tightness in crude supplies should intensify over the long term.
The total amount of recoverable oil in the world is now 9 percent lower than last year, according to research by Rystad Energy, a Norwegian energy consultancy, which could deal a major blow to global energy security. According to the analysis, the total amount of recoverable oil in the world is now estimated at 1.572 trillion barrels, 152 billion barrels less than the total in 2021.
The U.S. Energy Information Administration also said the global crude oil surplus in May was less than half the 2021 average because of western sanctions against Russia. Non-OPEC spare capacity as of May was down 80 percent from a year earlier, with Opec spare capacity falling to 3 million BPD from 5.4 million BPD a year earlier.
Russia has the capacity to cut output by 5m b/d without unduly damaging its economy. For much of the rest of the world, however, the result could be disastrous: if US and European sanctions prompt Retaliatory Russian production cuts, global oil prices could reach $380 a barrel.
Factors affecting freight forwarder break bulk Freight transportation
In international freight transport, one of the most concerning issues is the price of freight transport. The cost is directly related to the cost of transportation. Because many exporters do not understand the price of transportation very much, and often have a lot of extra spending, then today to understand the factors of the price of international freight transportation? Do You Need Freight Forwarders? China DDP for World is a full-service and shipping forwarder dedicated to assisting our clients in focusing and growing their businesses. Send an Email to firstname.lastname@example.org and get the latest freight price.
The transportation prices are different for different break bulk
In the general international trade process, the price of transport according to different modes of transport, price is also different. International freight rates are divided into sea freight, air freight and rail freight.
The specific break bulk freight rate can also be subdivided. For example, rail freight can be divided into passenger freight and freight. Shipping rates are also divided into tramp rates and liner rates. Tramp rates are also affected by market supply and demand relations at that time, while liner transport costs are relatively fixed. Airfreight can be divided into general goods, designated goods and special goods, and the specific transportation price is also determined according to the weight of transportation, at the same time, even if the volume is small, the weight is also counted by weight, but if the opposite is large, small weight, also according to the specific volume to calculate.
The choice of international logistics, the quality of logistics will affect the seller's store score, but also affect customer satisfaction rate.
Factors affecting the shipping price of break bulk
In the process of international transportation, there are many factors affecting the price of transportation, in addition to some fuel and labor costs, there are many important factors. For example, the nature of the break bulk, its own value and packaging form, as well as stowage factor and transporter's requirements for transportation, etc. There will be some fixed costs during the use of the ship, such as the ship's maintenance insurance and fuel consumption. There is also the change of supply and demand in the break bulk market. In the transport off-season, transport prices are relatively low, in the transport of the peak season, transport prices will be relatively high.
Logistics advantages of the break bulk in the destination country and region
In Eastern Europe, DHL has advantages in Romania, Bulgaria, Moldova, Hungary and other places while EMS has advantages in Greece, Russia, Turkey and other places. Western Europe, Northern Europe, southern Europe can use DHL international express, TNT international express, these two kinds of customs clearance capacity. TNT has a clear advantage in the Netherlands and Belgium.
For Canada, the United States and other American countries, FedEx, UPS and DHL are all suitable for their strong customs clearance capacity and fast time.
Applicable to Asia, South Korea, Japan, Thailand and other Southeast Asian countries DHL, FedEx. DHL and FedEx are time-saving, but THE price of DHL is higher. Indonesia also suggests USING DHL because it has a stronger customs clearance capacity.
In Oceania, DHL and UPS aging fast, with high prices; TNT and FedEx have lower prices but relatively few outlets. Particular attention should be paid to the "Made in China" label on the packaging of Australian products.
Middle East express ARAMEX, EMS for Middle East region. Commercial express in Africa is very expensive. In remote areas, IT is suggested to send EMS international express. EMS countries have the strongest customs clearance capacity. The air express break bulk can reach many countries and regions that commercial express and postal express cannot reach, so the wide range of break bulk transportation is its advantage.
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