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Thursday, 30 June 16
OIL PRODUCT TANKERS EARNINGS DECLINE AS STOCKBUILDING SLOWS DOWN - BIMCO
 BIMCO’s expectations remain as the oil product tanker fleet continues to grow with earnings at the lowest since Q3 in 2014. But there is still money to be made in the second half of 2016.
The oil product tanker market has reached a net fleet growth of 4.3m DWT so far in 2016. That is well in line with BIMCO’s full estimate of 8.5m DWT for the full year 2016. The main drivers of the total growth continue to be the MRs and LR2s.
With a net fleet growth of 5.8 % in 2015, the oil product tankers are looking to continue the trend of elevated supply growth with 3.0 % growth so far in 2016 – for the full year BIMCO expects 6.0 %.
Chief Analyst Peter Sand comments: “The LR2s and MRs are the leading segments for fleet growth in the oil product tanker market – in percentage as well as DWT in 2014 and 2015. This trend continues into the first half of 2016. Based on the current and anticipated new orders, BIMCO expects the net fleet growth in 2016 to be around the same level as in 2015 and likely to come down in 2017.
The earnings have been in decline since the beginning of 2016 and are actually at the lowest since Q3 in 2014. The reason for the decline is a combination of fleet growth alongside the deceleration of oil product stock building that was seen at the end of 2015 and early 2016. This is diminishing demand growth. While oil product production has been running ahead of end consumption, oil product tanker demand has risen above trend”.
Earnings decreasing into Q2 2016
All four oil product tanker segments have experienced an overall decline in earnings in 2016, with the LR2 seeing a 54 % decline from USD 33,966 per day from 1 January 2016 to USD 15,703 per day on 24 June 2016.
Peter Sand adds: “Due to our expectations that the freight rates would decline, we recommended back in January to fix some capacity on longer timecharters for companies with a high exposure to the spot market. We still see this need. As the spot rates are declining it is important to manage your risk and exposure to the market, as earnings could drop even further”.
Despite the demand side growing more than anticipated, the inflow of new tonnage has affected the freight market fundamentals and led to the present earnings.
Demand and supply for global oil is set to even out in Q3.
The demand growth for global oil according to The International Energy Agency (IEA) is up by 1.4 million barrels per day (mb/d) year on year for Q1 2016, compared to the previous expected 1.2 mb/d. Furthermore, they expect the demand and supply for global oil to be in balance in Q3 2016.
Peter Sand comments: “This balance puts an overhanging risk onto the global oil stockbuilding, which we have seen being built up on a large scale since mid-2014. When the global oil supply no longer outstrips global oil demand and the refineries cannot take advantage of the low and volatile crude oil prices, they do not contribute to further stockbuilding.
The increase in global oil demand and eventual levelling out over supply of oil means we will stop building stocks. We may even begin to draw down on the swollen stocks. This in turn presents an outside risk to the oil product tanker market. However, we could also see the new stock levels become permanent and so the tanker demand will not be affected in this way. Only time will tell how the dynamics will play out”.
Source: BIMCO
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Thursday, 28 July 16
FITCH RAISES CORPORATE OIL PRICE ASSUMPTION FOR 2016 TO USD42
Fitch Ratings has raised the 2016 oil price assumptions it uses when rating energy-sector corporates, but expects record high inventories to slow a ...
Thursday, 28 July 16
LAST WEEK ENDING UP WITH BUSIER TONES FOR SUPRAMAXES NOW COOLING DOWN - FEARNLEYS
Supramax
Last week ending up with busier tones for Supramaxes now cooling down as with index being down to 684. Average daily earnings for Supram ...
Wednesday, 27 July 16
RATES FOR THE SMALLER SIZES OVER-PERFORMED THE MARKET LAST WEEK - INTERMODAL
The decline the BDI noted last week was somewhat expected given the fact that the market has been overall firming for almost a month no ...
Wednesday, 27 July 16
GLOBAL OIL SUPPLY IS EXPECTED TO REMAIN HIGHER THAN GLOBAL CONSUMPTION IN 2016 - CHRISTOPHER WHITTY
Global oil supply is expected to remain higher than global consumption in 2016, keeping oil prices at relatively low levels this summer compared wi ...
Tuesday, 26 July 16
NORTH P&I CLUB EXPLAINS HOW TO AVOID CLAIMS FOR SELF-COOKING SOYA BEANS
KNOWLEDGE TO ELEVATE
North P&I Club has advised its members to be extra vigilant during loading and transport of soya beans to ensure they ...
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- Sree Jayajothi Cements Limited - India
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- Wilmar Investment Holdings
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- Ambuja Cements Ltd - India
- Australian Coal Association
- The University of Queensland
- Global Coal Blending Company Limited - Australia
- Petrochimia International Co. Ltd.- Taiwan
- Bhushan Steel Limited - India
- The State Trading Corporation of India Ltd
- PowerSource Philippines DevCo
- Bukit Makmur.PT - Indonesia
- SN Aboitiz Power Inc, Philippines
- Latin American Coal - Colombia
- Electricity Authority, New Zealand
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Global Business Power Corporation, Philippines
- Leighton Contractors Pty Ltd - Australia
- Krishnapatnam Port Company Ltd. - India
- Kobexindo Tractors - Indoneisa
- Mjunction Services Limited - India
- Orica Australia Pty. Ltd.
- Directorate General of MIneral and Coal - Indonesia
- Bulk Trading Sa - Switzerland
- SMC Global Power, Philippines
- Cement Manufacturers Association - India
- Aditya Birla Group - India
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- Billiton Holdings Pty Ltd - Australia
- Medco Energi Mining Internasional
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- Georgia Ports Authority, United States
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- Merrill Lynch Commodities Europe
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- Bhatia International Limited - India
- Indian Energy Exchange, India
- Sarangani Energy Corporation, Philippines
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Vijayanagar Sugar Pvt Ltd - India
- Jaiprakash Power Ventures ltd
- Eastern Energy - Thailand
- Metalloyd Limited - United Kingdom
- Dalmia Cement Bharat India
- Edison Trading Spa - Italy
- Anglo American - United Kingdom
- Maharashtra Electricity Regulatory Commission - India
- Bukit Baiduri Energy - Indonesia
- Vedanta Resources Plc - India
- Ministry of Transport, Egypt
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- Larsen & Toubro Limited - India
- Economic Council, Georgia
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- Attock Cement Pakistan Limited
- PetroVietnam Power Coal Import and Supply Company
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- Maheswari Brothers Coal Limited - India
- Jindal Steel & Power Ltd - India
- GMR Energy Limited - India
- Sical Logistics Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Altura Mining Limited, Indonesia
- MS Steel International - UAE
- Tamil Nadu electricity Board
- Goldman Sachs - Singapore
- Binh Thuan Hamico - Vietnam
- Parliament of New Zealand
- Chettinad Cement Corporation Ltd - India
- Bangladesh Power Developement Board
- Bayan Resources Tbk. - Indonesia
- New Zealand Coal & Carbon
- Banpu Public Company Limited - Thailand
- Thiess Contractors Indonesia
- European Bulk Services B.V. - Netherlands
- Sinarmas Energy and Mining - Indonesia
- Borneo Indobara - Indonesia
- Siam City Cement PLC, Thailand
- Planning Commission, India
- Coalindo Energy - Indonesia
- Semirara Mining Corp, Philippines
- IHS Mccloskey Coal Group - USA
- Coal and Oil Company - UAE
- Pipit Mutiara Jaya. PT, Indonesia
- Mercator Lines Limited - India
- Australian Commodity Traders Exchange
- Toyota Tsusho Corporation, Japan
- Standard Chartered Bank - UAE
- ASAPP Information Group - India
- ICICI Bank Limited - India
- Power Finance Corporation Ltd., India
- CIMB Investment Bank - Malaysia
- International Coal Ventures Pvt Ltd - India
- Kideco Jaya Agung - Indonesia
- Kepco SPC Power Corporation, Philippines
- Oldendorff Carriers - Singapore
- Central Java Power - Indonesia
- Singapore Mercantile Exchange
- Indo Tambangraya Megah - Indonesia
- VISA Power Limited - India
- South Luzon Thermal Energy Corporation
- Karbindo Abesyapradhi - Indoneisa
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- Uttam Galva Steels Limited - India
- Sindya Power Generating Company Private Ltd
- Holcim Trading Pte Ltd - Singapore
- Orica Mining Services - Indonesia
- Thai Mozambique Logistica
- TNB Fuel Sdn Bhd - Malaysia
- Savvy Resources Ltd - HongKong
- Rio Tinto Coal - Australia
- London Commodity Brokers - England
- Globalindo Alam Lestari - Indonesia
- Indika Energy - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Tata Chemicals Ltd - India
- Intertek Mineral Services - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Commonwealth Bank - Australia
- Samtan Co., Ltd - South Korea
- Romanian Commodities Exchange
- Jorong Barutama Greston.PT - Indonesia
- Directorate Of Revenue Intelligence - India
- Ind-Barath Power Infra Limited - India
- PNOC Exploration Corporation - Philippines
- Videocon Industries ltd - India
- Xindia Steels Limited - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Vizag Seaport Private Limited - India
- GVK Power & Infra Limited - India
- Mintek Dendrill Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Star Paper Mills Limited - India
- Chamber of Mines of South Africa
- Gujarat Electricity Regulatory Commission - India
- White Energy Company Limited
- Africa Commodities Group - South Africa
- Central Electricity Authority - India
- Antam Resourcindo - Indonesia
- Mercuria Energy - Indonesia
- Energy Development Corp, Philippines
- Offshore Bulk Terminal Pte Ltd, Singapore
- Iligan Light & Power Inc, Philippines
- Indonesian Coal Mining Association
- Bhoruka Overseas - Indonesia
- PTC India Limited - India
- Energy Link Ltd, New Zealand
- Bharathi Cement Corporation - India
- Renaissance Capital - South Africa
- Timah Investasi Mineral - Indoneisa
- CNBM International Corporation - China
- Meralco Power Generation, Philippines
- Parry Sugars Refinery, India
- Heidelberg Cement - Germany
- Baramulti Group, Indonesia
- Electricity Generating Authority of Thailand
- Essar Steel Hazira Ltd - India
- Kohat Cement Company Ltd. - Pakistan
- Makarim & Taira - Indonesia
- Minerals Council of Australia
- Ministry of Finance - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Lanco Infratech Ltd - India
- Deloitte Consulting - India
- AsiaOL BioFuels Corp., Philippines
- Ceylon Electricity Board - Sri Lanka
- Port Waratah Coal Services - Australia
- The Treasury - Australian Government
- IEA Clean Coal Centre - UK
- Rashtriya Ispat Nigam Limited - India
- Gujarat Mineral Development Corp Ltd - India
- Alfred C Toepfer International GmbH - Germany
- Salva Resources Pvt Ltd - India
- Miang Besar Coal Terminal - Indonesia
- Manunggal Multi Energi - Indonesia
- Wood Mackenzie - Singapore
- Sojitz Corporation - Japan
- Indian Oil Corporation Limited
- Siam City Cement - Thailand
- GN Power Mariveles Coal Plant, Philippines
- Posco Energy - South Korea
- Barasentosa Lestari - Indonesia
- India Bulls Power Limited - India
- Karaikal Port Pvt Ltd - India
- OPG Power Generation Pvt Ltd - India
- Formosa Plastics Group - Taiwan
- Carbofer General Trading SA - India
- Malabar Cements Ltd - India
- Kaltim Prima Coal - Indonesia
- Kumho Petrochemical, South Korea
- McConnell Dowell - Australia
- Therma Luzon, Inc, Philippines
- Kartika Selabumi Mining - Indonesia
- Riau Bara Harum - Indonesia
- Eastern Coal Council - USA
- Coastal Gujarat Power Limited - India
- Neyveli Lignite Corporation Ltd, - India
- SMG Consultants - Indonesia
- LBH Netherlands Bv - Netherlands
- Marubeni Corporation - India
- Straits Asia Resources Limited - Singapore
- Simpson Spence & Young - Indonesia
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