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Saturday, 22 June 19
OPEC'S BATTLE FOR CONTROL OF THE OIL MARKET - WOOD MACKENZIE
 Oil supply is confounding expectations. We have just raised our forecasts for non-OPEC production, the latest in a series of incremental increases. Cumulatively, we’ve increased volumes for 2025 by an astonishing 9 million b/d compared with our forecasts in 2016, the oil price nadir. Non-OPEC supply has already bounced from the 2016 low of 54 million b/d and will touch 60 million b/d this year. Our latest Macro Oils Long Term Outlook expects a peak of 66 million b/d in 2025, 5% above our forecast last year. Oil demand too has grown more quickly than expected, up 6 million b/d on 2016 forecasts.
“Did we, like many others, underestimate the industry’s ability to adapt and innovate in the face of financial adversity – and keep on producing oil? Maybe.”
Simon Flowers
Chairman and Chief Analyst
Production keeps on growing despite structurally lower oil prices and upstream investment still 40% below peak. Did we, like many others, underestimate the industry’s ability to adapt and innovate in the face of financial adversity – and keep on producing oil? Maybe. But where on earth is it all coming from? There are four main buckets.
1. US Lower 48
tight oil and NGLs together contribute 4.3 million b/d, half of the increase versus 2016. This primarily reflects the emergence of the Permian basin as the dominant tight oil play. The delineation of sweet spots, more efficient drilling, and the present shift to industrialised exploitation have led to a significant improvement in Permian well economics. Innovation has boosted expected recovery from the more mature Bakken, Eagle Ford and Scoop-Stack plays to a lesser extent. NGLs associated with the gassier parts of the Permian and shale gas plays make up about one-third of the US L48 increase.
2. Russia
Our forecasts for 2025 are 1.4 million b/d higher than three years ago, in spite of sanctions which restrict inward investment and the transfer of the latest technological advances. Rouble weakness has buoyed upstream margins in Russia since the price fell, supporting higher investment, including an intense drilling programme in deeper, low-permeability plays in West Siberia. Sanction of some greenfield projects has been deferred by Russia’s involvement in OPEC+, effectively pushing new volumes out by a few years.
3. Guyana
Only the original Liza discovery was in our 2016 forecasts. We’ve added another 0.5 million b/d by 2025, reflecting multiple subsequent deepwater discoveries. First production is due in 2020, setting Guyana on track to enter the top 12 non-OPEC producers with over 1 million b/d by the end of the decade.
4. Mature producers
Together, these have added over 2 million b/d compared with our 2016 forecasts. Colombia, UK, Norway, US (Alaska) and Canada are among a plethora of countries which have surprised on the upside. Cost cutting, efficiencies, reduced maintenance outages, high-grading and streamlining of new projects, new discoveries tied into existing infrastructure and, in some cases, reduced tax rates have combined to slow decline rates and boost production. There are valid questions whether production from ultra-mature basins is sustainable at these rates, or volumes are merely being accelerated. As a result , some of these producers are slated to see steeper declines.
Non-OPEC supply won’t grow at this rate forever
In fact, Non-OPEC supply stops after 2025 as tight oil plateaus, with decline setting in by 2030. In the meantime, the OPEC+ strategy to boost revenues by constraining production and buoying up price has helped its competitors boost production and gain market share.
We estimate non-OPEC production will swallow up 4.3 million b/d, or 76%, of contestable demand over the next five years. OPEC’s scope to increase volumes through this period is limited to just 1.3 million b/d. The maths sits at odds with Abu Dhabi, Kuwait and Iraq which are investing heavily in new capacity. Some producers in OPEC do see flat or declining volumes in this period.
Major supply outages are helping OPEC+ to balance the market today. Disruptions are set to leap to a record 5 million b/d later this year, including 2.5 million b/d from Iran (sanctions) and Venezuela (economic meltdown and US sanctions). It may suit the rest of OPEC, as well as the US, if exports from Iran and Venezuela are kept off the market for some years – at least until non-OPEC production growth shows signs of abating.
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Wednesday, 31 July 19
INDIA'S 2019 THERMAL COAL IMPORTS SEEN AT 180-185 MLN T - WOODMAC
India is expected to import 180-185 million tonnes of thermal coal in 2019, said Dale Hazelton, head of thermal coal at consultancy Wood Mackenzie. ...
Wednesday, 31 July 19
SHIPPING MARKET INSIGHT - INTERMODAL
It was a fairly busy week in the dry S&P market. Despite the ease of Capesize rates which impacted Panamaxes as well, interest from potential b ...
Sunday, 28 July 19
ULTRAMAX - INDONESIAN COAL CARGOES SAW A 63,000DWT SHIP FIXING DELIVERY FOR A SOUTH CHINA TRIP VIA INDONESIA, REDELIVERY CHINA, AT $11,700 - BALTIC BRIEFING
Capesize
The market was a white knuckled ride this past week as a large downside movement shed value quickly leaving many in bewilderment. The ...
Wednesday, 24 July 19
CHINA TAIYUAN COAL TRANSACTION PRICE INDEX DOWN 0.27 PCT - XINHUA
China Taiyuan coal transaction price index stood at 138.78 points Monday, down 0.27 percent week on week.
The index, released by Chi ...
Wednesday, 24 July 19
SHIPPING MARKET INSIGHT - INTERMODAL
Tonnes of ink has been spent analysing the rebound of the dry bulk market the last weeks with the most representative example being the rising perf ...
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- Jaiprakash Power Ventures ltd
- Renaissance Capital - South Africa
- India Bulls Power Limited - India
- Jindal Steel & Power Ltd - India
- Kaltim Prima Coal - Indonesia
- Oldendorff Carriers - Singapore
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Power Finance Corporation Ltd., India
- Africa Commodities Group - South Africa
- Larsen & Toubro Limited - India
- Iligan Light & Power Inc, Philippines
- Siam City Cement PLC, Thailand
- Aboitiz Power Corporation - Philippines
- Deloitte Consulting - India
- New Zealand Coal & Carbon
- Medco Energi Mining Internasional
- Australian Commodity Traders Exchange
- Kumho Petrochemical, South Korea
- Sinarmas Energy and Mining - Indonesia
- Singapore Mercantile Exchange
- Videocon Industries ltd - India
- Bharathi Cement Corporation - India
- Chamber of Mines of South Africa
- Indonesian Coal Mining Association
- Planning Commission, India
- Rashtriya Ispat Nigam Limited - India
- Dalmia Cement Bharat India
- Malabar Cements Ltd - India
- Coalindo Energy - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Central Electricity Authority - India
- Rio Tinto Coal - Australia
- Kideco Jaya Agung - Indonesia
- Minerals Council of Australia
- Vijayanagar Sugar Pvt Ltd - India
- Essar Steel Hazira Ltd - India
- Central Java Power - Indonesia
- Commonwealth Bank - Australia
- Mintek Dendrill Indonesia
- White Energy Company Limited
- Kohat Cement Company Ltd. - Pakistan
- Electricity Authority, New Zealand
- Cigading International Bulk Terminal - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Kalimantan Lumbung Energi - Indonesia
- Chettinad Cement Corporation Ltd - India
- Anglo American - United Kingdom
- Posco Energy - South Korea
- Sarangani Energy Corporation, Philippines
- Offshore Bulk Terminal Pte Ltd, Singapore
- Vedanta Resources Plc - India
- Indika Energy - Indonesia
- Karaikal Port Pvt Ltd - India
- Binh Thuan Hamico - Vietnam
- PowerSource Philippines DevCo
- Electricity Generating Authority of Thailand
- Barasentosa Lestari - Indonesia
- Salva Resources Pvt Ltd - India
- The University of Queensland
- Metalloyd Limited - United Kingdom
- Australian Coal Association
- Formosa Plastics Group - Taiwan
- Miang Besar Coal Terminal - Indonesia
- Energy Link Ltd, New Zealand
- Alfred C Toepfer International GmbH - Germany
- Sree Jayajothi Cements Limited - India
- Eastern Coal Council - USA
- Sojitz Corporation - Japan
- Georgia Ports Authority, United States
- Leighton Contractors Pty Ltd - Australia
- Mercuria Energy - Indonesia
- Interocean Group of Companies - India
- Semirara Mining Corp, Philippines
- Sical Logistics Limited - India
- Savvy Resources Ltd - HongKong
- ICICI Bank Limited - India
- OPG Power Generation Pvt Ltd - India
- Uttam Galva Steels Limited - India
- Therma Luzon, Inc, Philippines
- Ind-Barath Power Infra Limited - India
- Bhatia International Limited - India
- Ambuja Cements Ltd - India
- Bhushan Steel Limited - India
- CIMB Investment Bank - Malaysia
- Tata Chemicals Ltd - India
- Samtan Co., Ltd - South Korea
- Lanco Infratech Ltd - India
- Pendopo Energi Batubara - Indonesia
- Globalindo Alam Lestari - Indonesia
- Bulk Trading Sa - Switzerland
- Cement Manufacturers Association - India
- GVK Power & Infra Limited - India
- Kapuas Tunggal Persada - Indonesia
- Mjunction Services Limited - India
- Asmin Koalindo Tuhup - Indonesia
- SN Aboitiz Power Inc, Philippines
- Manunggal Multi Energi - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Krishnapatnam Port Company Ltd. - India
- Bangladesh Power Developement Board
- Latin American Coal - Colombia
- Maheswari Brothers Coal Limited - India
- Kartika Selabumi Mining - Indonesia
- Aditya Birla Group - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- MS Steel International - UAE
- Billiton Holdings Pty Ltd - Australia
- Bhoruka Overseas - Indonesia
- Banpu Public Company Limited - Thailand
- Petron Corporation, Philippines
- Holcim Trading Pte Ltd - Singapore
- Wilmar Investment Holdings
- Ceylon Electricity Board - Sri Lanka
- Makarim & Taira - Indonesia
- Meenaskhi Energy Private Limited - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Bukit Makmur.PT - Indonesia
- Ministry of Transport, Egypt
- Siam City Cement - Thailand
- International Coal Ventures Pvt Ltd - India
- Goldman Sachs - Singapore
- PetroVietnam Power Coal Import and Supply Company
- Orica Mining Services - Indonesia
- TeaM Sual Corporation - Philippines
- Maharashtra Electricity Regulatory Commission - India
- Indian Oil Corporation Limited
- Directorate General of MIneral and Coal - Indonesia
- Meralco Power Generation, Philippines
- Intertek Mineral Services - Indonesia
- Global Green Power PLC Corporation, Philippines
- Tamil Nadu electricity Board
- Coastal Gujarat Power Limited - India
- Xindia Steels Limited - India
- Parliament of New Zealand
- South Luzon Thermal Energy Corporation
- Directorate Of Revenue Intelligence - India
- Economic Council, Georgia
- Riau Bara Harum - Indonesia
- Wood Mackenzie - Singapore
- Semirara Mining and Power Corporation, Philippines
- GAC Shipping (India) Pvt Ltd
- Global Coal Blending Company Limited - Australia
- Thiess Contractors Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Agrawal Coal Company - India
- Heidelberg Cement - Germany
- Baramulti Group, Indonesia
- Thai Mozambique Logistica
- Gujarat Sidhee Cement - India
- Straits Asia Resources Limited - Singapore
- Indo Tambangraya Megah - Indonesia
- Eastern Energy - Thailand
- GMR Energy Limited - India
- Antam Resourcindo - Indonesia
- Orica Australia Pty. Ltd.
- Ministry of Finance - Indonesia
- Port Waratah Coal Services - Australia
- Carbofer General Trading SA - India
- Madhucon Powers Ltd - India
- Bahari Cakrawala Sebuku - Indonesia
- Timah Investasi Mineral - Indoneisa
- Bayan Resources Tbk. - Indonesia
- PTC India Limited - India
- Edison Trading Spa - Italy
- Grasim Industreis Ltd - India
- Toyota Tsusho Corporation, Japan
- TNB Fuel Sdn Bhd - Malaysia
- Romanian Commodities Exchange
- Price Waterhouse Coopers - Russia
- Energy Development Corp, Philippines
- Sindya Power Generating Company Private Ltd
- McConnell Dowell - Australia
- European Bulk Services B.V. - Netherlands
- Parry Sugars Refinery, India
- Kepco SPC Power Corporation, Philippines
- Bukit Baiduri Energy - Indonesia
- CNBM International Corporation - China
- Global Business Power Corporation, Philippines
- GN Power Mariveles Coal Plant, Philippines
- Jorong Barutama Greston.PT - Indonesia
- Independent Power Producers Association of India
- SMG Consultants - Indonesia
- Merrill Lynch Commodities Europe
- Karbindo Abesyapradhi - Indoneisa
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Trasteel International SA, Italy
- VISA Power Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- The State Trading Corporation of India Ltd
- LBH Netherlands Bv - Netherlands
- SMC Global Power, Philippines
- Bukit Asam (Persero) Tbk - Indonesia
- Attock Cement Pakistan Limited
- Indogreen Group - Indonesia
- IEA Clean Coal Centre - UK
- Mercator Lines Limited - India
- London Commodity Brokers - England
- Star Paper Mills Limited - India
- Kobexindo Tractors - Indoneisa
- Coal and Oil Company - UAE
- Gujarat Electricity Regulatory Commission - India
- IHS Mccloskey Coal Group - USA
- Indian Energy Exchange, India
- Standard Chartered Bank - UAE
- Borneo Indobara - Indonesia
- Simpson Spence & Young - Indonesia
- Vizag Seaport Private Limited - India
- PNOC Exploration Corporation - Philippines
- Altura Mining Limited, Indonesia
- Sakthi Sugars Limited - India
- Ministry of Mines - Canada
- San Jose City I Power Corp, Philippines
- Marubeni Corporation - India
- ASAPP Information Group - India
- AsiaOL BioFuels Corp., Philippines
- The Treasury - Australian Government
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