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Wednesday, 03 October 18
SHIPPING MARKET INSIGHT - KATERINA RESTIS
 The bunker fuel supply and availability landscape is close to its transformation with the enforcement of the IMO’s global 0.5% fuel Sulphur content cap regulation from 1st of January, 2020. Shipowners will have to choose between available options for them to comply with the regulation, while refiners will have to make suitable changes to refinery configuration and production in response to market demand. Thus far all parties will have to decide on the most efficient and appropriate solution that will suit their operations and allow them to remain commercially sustainable in the long run.
The swipe from the present 3.5% to 0.5% Sulphur content marine fuel will practically be an overnight shift as refineries would need to continue production and supply of up to 3.5% marine fuel until the day regulation requirement kicks in. Global refining will face enormous logistics, storage and delivery issues, while ships will have to clean out fuel systems to avoid Sulphur contamination. Thus, there is a risk such quick swing to lead to a period of product shortages and inflated marine oil prices. According to data reported on average up to 2017, the shipping industry was consuming approximately 3.2m barrels p/d of HFO and 800k p/d of MGO. Accordingly, from 2020 onwards it is estimated that proportion will alter to 700k p/d of HFO to 3.4m barrels p/d of MGO. Obviously, the use of compliant Sulphur oil products will be the expensive solution for ship-owners that will either absorb the cost or possibly operators will try to pass the cost to Charterers via increased freight rates.
Simple refineries that produce a substantial share of their crude oil into HFO may face margin pressures, while complex refineries with greater infrastructures may potentially boost margins with larger production of low Sulphur products. IEA has stated that if refiners ran at similar utilization rates as of today, it would be unlikely to produce the essential volumes of gas oil. Particularly, if quantity rises to meet the required gas oil volumes, margins would be inevitably affected by shrinking profits.
Overall, oil majors and refineries will try to back up the bunker fuel demand ascending from the new regulation through several ways. Refiners may elevate ULSFO production by extracting low Sulphur fuel streams that are currently blended into LSFO or HSFO will be made available to the market as ULS FO. ExxonMobil, for example has introduced a product, Heavy Distillate Marine ECA 50 that can be consumed onboard like HFO and has only 0.1% Sulphur content. Furthermore, refiners have an issue of handling their surplus residue as this option comes with higher risk on returns of investment. This is due to the fact that oil demand is founded on shippers’ uptake of alternative options such as scrubber installation and LNG bunkering. Refiners can raise LNG bunker supplies in major bunkering hubs. In Singapore, Shell and ExxonMobil are working with Maritime and Port Authority of Singapore to supply LNG as fuel.
To sum up, in the scenario that refineries restrict the availability of HFO on expected higher margins from selling MGO, then vessels fitted with scrubbers might face challenges in relation to adequate supply of HFO. On the other hand, refineries worry that any surge in the use of MGO would head to excess quantity of HFO. For sure refineries are not rushing to big investments to change production set ups while ship-owners are still considering their options. It’s a dilemma for all parties and a puzzle to be solved.
By Katerina Restis
Tanker Chartering
Compiled by:
Intermodal Research & Valuations
Analysts:
Ms Eva Tzima
George Panagopoulos
Disclaimer and legal disclosure: For any further queries please do not hesitate to contact our Research & Valuations Department. The information contained in this report has been obtained from various sources, as reported in the market. Intermodal Shipbrokers Co. believes such information to be factual and reliable without making guarantees regarding its accuracy or completeness. Whilst every care has been taken in the production of the above review, no liability can be accepted for any loss or damage incurred in any way whatsoever by any person who may seek to rely on the information and views contained in this material. This report is being produced for the internal use of the intended recipients only and no reproducing is allowed, without the prior written authorization of Intermodal Shipbrokers Co.
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Tuesday, 02 October 18
PANAMAX: A FURTHER RISE ACROSS ALL MAIN ROUTES THIS WEEK - ALLIED
Capesize
Finally an upward recovery was in sight in the spot market the past few days, after the prolonged negative pressure noted the weeks pr ...
Tuesday, 02 October 18
THE PRICE OF OIL CONTINUES ITS CLIMB AMIDST A SERIES OF CONCERNS REGARDING SUPPLY CONSTRAINTS - GEORGE LAZARIDIS
It has been a busy week for oil traders as the price of oil continues its climb amidst a series of concerns regarding supply constraints.
...
Tuesday, 02 October 18
INDONESIA GETS READY TO MEET INCREASED COAL DEMAND FROM CHINA, FREIGHT TO RESPOND - MIKAL BOE
Indonesian coal suppliers have increased their domestic coal production target by 4.5 percent from a previous 485 million tonnes to a massive 507 m ...
Monday, 01 October 18
SUPRAMAX: A 56,000 DWT FIXED DELIVERY FOR A SURABAYA TRIP WITH REDELIVERY TO WEST COAST INDIA AT $13,500 - THE BALTIC BRIEFING
Capesize
A stop-start market for the big ships with many expectations and few fulfilled. Holidays curtailed trading early in the week, but the ...
Monday, 01 October 18
A NO-DEAL BREXIT WILL UNDOUBTEDLY HAVE CONSEQUENCES FOR IMPORTERS AND EXPORTERS - KATE JONES, THE BALTIC BRIEFING
If you live in the UK, you might be finding it difficult to get away from the Brexit debate. “Hard Brexit”, “soft Brexit”, ...
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Showing 1601 to 1605 news of total 6871 |
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- Ambuja Cements Ltd - India
- Goldman Sachs - Singapore
- Kepco SPC Power Corporation, Philippines
- GMR Energy Limited - India
- Barasentosa Lestari - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Petron Corporation, Philippines
- Therma Luzon, Inc, Philippines
- Rio Tinto Coal - Australia
- Global Coal Blending Company Limited - Australia
- Sree Jayajothi Cements Limited - India
- Anglo American - United Kingdom
- Romanian Commodities Exchange
- GVK Power & Infra Limited - India
- Lanco Infratech Ltd - India
- The State Trading Corporation of India Ltd
- White Energy Company Limited
- Billiton Holdings Pty Ltd - Australia
- South Luzon Thermal Energy Corporation
- Bhatia International Limited - India
- Coal and Oil Company - UAE
- Bukit Asam (Persero) Tbk - Indonesia
- Globalindo Alam Lestari - Indonesia
- Grasim Industreis Ltd - India
- Maheswari Brothers Coal Limited - India
- Sinarmas Energy and Mining - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Ministry of Transport, Egypt
- Siam City Cement - Thailand
- Agrawal Coal Company - India
- Kobexindo Tractors - Indoneisa
- ASAPP Information Group - India
- Intertek Mineral Services - Indonesia
- Manunggal Multi Energi - Indonesia
- Uttam Galva Steels Limited - India
- SN Aboitiz Power Inc, Philippines
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Bhushan Steel Limited - India
- Wood Mackenzie - Singapore
- Trasteel International SA, Italy
- Attock Cement Pakistan Limited
- Larsen & Toubro Limited - India
- Sakthi Sugars Limited - India
- Indian Oil Corporation Limited
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Banpu Public Company Limited - Thailand
- Singapore Mercantile Exchange
- Borneo Indobara - Indonesia
- Independent Power Producers Association of India
- Meralco Power Generation, Philippines
- IHS Mccloskey Coal Group - USA
- European Bulk Services B.V. - Netherlands
- Deloitte Consulting - India
- Makarim & Taira - Indonesia
- Orica Mining Services - Indonesia
- Jaiprakash Power Ventures ltd
- Ind-Barath Power Infra Limited - India
- Directorate General of MIneral and Coal - Indonesia
- Videocon Industries ltd - India
- Global Business Power Corporation, Philippines
- Edison Trading Spa - Italy
- Kohat Cement Company Ltd. - Pakistan
- Mjunction Services Limited - India
- Holcim Trading Pte Ltd - Singapore
- International Coal Ventures Pvt Ltd - India
- The Treasury - Australian Government
- Bayan Resources Tbk. - Indonesia
- PowerSource Philippines DevCo
- Metalloyd Limited - United Kingdom
- Indian Energy Exchange, India
- AsiaOL BioFuels Corp., Philippines
- Kalimantan Lumbung Energi - Indonesia
- OPG Power Generation Pvt Ltd - India
- Merrill Lynch Commodities Europe
- Indika Energy - Indonesia
- Thiess Contractors Indonesia
- CNBM International Corporation - China
- Meenaskhi Energy Private Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- Rashtriya Ispat Nigam Limited - India
- Standard Chartered Bank - UAE
- Planning Commission, India
- Power Finance Corporation Ltd., India
- PNOC Exploration Corporation - Philippines
- Ceylon Electricity Board - Sri Lanka
- Oldendorff Carriers - Singapore
- Economic Council, Georgia
- New Zealand Coal & Carbon
- Bahari Cakrawala Sebuku - Indonesia
- Baramulti Group, Indonesia
- Electricity Generating Authority of Thailand
- Salva Resources Pvt Ltd - India
- Cement Manufacturers Association - India
- Maharashtra Electricity Regulatory Commission - India
- Bulk Trading Sa - Switzerland
- San Jose City I Power Corp, Philippines
- Savvy Resources Ltd - HongKong
- Energy Development Corp, Philippines
- Binh Thuan Hamico - Vietnam
- Tata Chemicals Ltd - India
- Kapuas Tunggal Persada - Indonesia
- Price Waterhouse Coopers - Russia
- Eastern Energy - Thailand
- MS Steel International - UAE
- Thai Mozambique Logistica
- Semirara Mining and Power Corporation, Philippines
- Chettinad Cement Corporation Ltd - India
- Sical Logistics Limited - India
- Pendopo Energi Batubara - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Toyota Tsusho Corporation, Japan
- Xindia Steels Limited - India
- Straits Asia Resources Limited - Singapore
- Heidelberg Cement - Germany
- Carbofer General Trading SA - India
- The University of Queensland
- CIMB Investment Bank - Malaysia
- Ministry of Finance - Indonesia
- Parliament of New Zealand
- Orica Australia Pty. Ltd.
- Mintek Dendrill Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- ICICI Bank Limited - India
- Timah Investasi Mineral - Indoneisa
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- PTC India Limited - India
- Star Paper Mills Limited - India
- TNB Fuel Sdn Bhd - Malaysia
- Dalmia Cement Bharat India
- Bangladesh Power Developement Board
- Commonwealth Bank - Australia
- Directorate Of Revenue Intelligence - India
- Posco Energy - South Korea
- Aditya Birla Group - India
- Coalindo Energy - Indonesia
- Kideco Jaya Agung - Indonesia
- Bukit Baiduri Energy - Indonesia
- Sarangani Energy Corporation, Philippines
- Interocean Group of Companies - India
- Vedanta Resources Plc - India
- Latin American Coal - Colombia
- Marubeni Corporation - India
- SMC Global Power, Philippines
- Jindal Steel & Power Ltd - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Energy Link Ltd, New Zealand
- Karaikal Port Pvt Ltd - India
- Australian Commodity Traders Exchange
- Miang Besar Coal Terminal - Indonesia
- India Bulls Power Limited - India
- GN Power Mariveles Coal Plant, Philippines
- Coastal Gujarat Power Limited - India
- Minerals Council of Australia
- Eastern Coal Council - USA
- IEA Clean Coal Centre - UK
- Indo Tambangraya Megah - Indonesia
- Medco Energi Mining Internasional
- Siam City Cement PLC, Thailand
- London Commodity Brokers - England
- Chamber of Mines of South Africa
- Gujarat Sidhee Cement - India
- McConnell Dowell - Australia
- Bhoruka Overseas - Indonesia
- Renaissance Capital - South Africa
- Mercuria Energy - Indonesia
- TeaM Sual Corporation - Philippines
- Karbindo Abesyapradhi - Indoneisa
- Mercator Lines Limited - India
- PetroVietnam Power Coal Import and Supply Company
- VISA Power Limited - India
- Georgia Ports Authority, United States
- Jorong Barutama Greston.PT - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- GAC Shipping (India) Pvt Ltd
- Ministry of Mines - Canada
- Sojitz Corporation - Japan
- Formosa Plastics Group - Taiwan
- Electricity Authority, New Zealand
- Antam Resourcindo - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Pipit Mutiara Jaya. PT, Indonesia
- Tamil Nadu electricity Board
- Gujarat Mineral Development Corp Ltd - India
- Riau Bara Harum - Indonesia
- Australian Coal Association
- Central Java Power - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Simpson Spence & Young - Indonesia
- Central Electricity Authority - India
- Samtan Co., Ltd - South Korea
- Sindya Power Generating Company Private Ltd
- SMG Consultants - Indonesia
- Iligan Light & Power Inc, Philippines
- Vizag Seaport Private Limited - India
- Kartika Selabumi Mining - Indonesia
- Semirara Mining Corp, Philippines
- Altura Mining Limited, Indonesia
- Leighton Contractors Pty Ltd - Australia
- Kaltim Prima Coal - Indonesia
- Kumho Petrochemical, South Korea
- Aboitiz Power Corporation - Philippines
- Indonesian Coal Mining Association
- Neyveli Lignite Corporation Ltd, - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Parry Sugars Refinery, India
- Bukit Makmur.PT - Indonesia
- LBH Netherlands Bv - Netherlands
- Malabar Cements Ltd - India
- Port Waratah Coal Services - Australia
- Indogreen Group - Indonesia
- Global Green Power PLC Corporation, Philippines
- Essar Steel Hazira Ltd - India
- Wilmar Investment Holdings
- Africa Commodities Group - South Africa
- Bharathi Cement Corporation - India
- Madhucon Powers Ltd - India
- Cigading International Bulk Terminal - Indonesia
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