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Monday, 02 December 19
OPEC PREPS FOR OIL'S 2020 BALANCING ACT - WOOD MACKENZIE
 What steps should OPEC and its non-OPEC partners take to keep the market in balance in 2020? Ahead of OPEC’s meeting in Vienna on 5 and 6 December, I turned to Ann-Louise Hittle, Vice President Macro Oils, for answers.
What does good look like for OPEC in 2020? Given the uncertainty around global supply growth, demand and geopolitics, OPEC will do well to get an outcome like 2019. Brent will average U.S.$64 per barrel in 2019, down on last year’s U.S.$71, but still the second-highest annual price since 2014. It’s a measure of OPEC’s success so far in balancing what is a fundamentally an oversupplied market.
Will demand recover in 2020? We think so. This year has disappointed because of a series of one-off factors and the slowing global economy. The 0.6 million barrels per day (b/d) outcome will be well down on the 1.1 million b/d we forecast back in January 2019.
Sanctions-related demand destruction in Venezuela and Iran, plus warm weather in Europe shouldn’t feature next year. We think annual growth will double in 2020 to 1.4 million b/d. China will be key – we expect growth there to double to 0.6 million b/d, buoyed by strong demand for marine gasoil, as bunker volumes move in response to the new low-sulphur IMO regulations on shipping fuels.
Is global supply still growing rapidly? Yes, we expect an increase of 1.8 million b/d in 2020 –assuming OPEC+ maintains its current production cuts.
What’s changing is the mix, and for the first time in years, the U.S. Lower 48 won’t dominate as much. U.S. is about half the 2020 growth, with the rest coming from other non-OPEC producers including Guyana, Brazil and Norway. The giant Norwegian field, Johan Sverdrup, on stream since October, will add 0.3 million b/d in 2020.
So, U.S. tight oil is still growing? Yes, but at a much slower rate. We expect an increase of 0.5 million b/d, well below the 2018 annual peak of 1.5 million b/d. The rig count is down by 18%, or almost 200 rigs from the November 2018 high, across all tight oil plays. Monthly production growth year-on-year peaked at 1.8 million b/d in August 2018 and could slip to just 0.4 million b/d by end 2020.
Did we anticipate that? We expected 2018 to be the peak year of U.S. tight oil growth – but not the rate of slowdown we’re seeing unfold. Investors are forcing U.S. independents, which account for 80% of tight oil production, to pare back spend on growth and generate cash flow.
What growth there is by end 2020 will come mostly from the Majors (ExxonMobil, Chevron, BP and Shell) whose plans are unaffected by capital constraints.
There’s a certain irony that the free market, through shareholder influence, is succeeding in slowing growth – to OPEC’s advantage.
Time will tell how long it lasts – we think we’ll see tight oil growth recover in 2021 though not back to peak rates.
What about OPEC production? A lot of OPEC oil is off the market – volumes are 2.5 million b/d below a year ago. Around half of that is involuntary, due to U.S. sanctions on Venezuelan and Iranian exports. The other 1.2 million b/d are deliberate cuts by OPEC+. Admirable adherence by key producers in the OPEC+ group has been instrumental in balancing the market and holding Brent above U.S.$60 this year. Without cuts, prices would be much lower.
What does OPEC need to do in December? The current agreement on cuts expires in March 2020. OPEC+ needs to rollover through to the end of 2020. But with global supply growth outpacing demand in 2020, we’ll need further cuts if demand growth disappoints again. OPEC will have to move promptly, in this case, and take out additional production if it wants to support price.
Will fundamentals or geopolitics drive the market in 2020? A bit of both. Tension in the Middle East and U.S. global influence are risks again next year. U.S. foreign policy has been emboldened by the rise of tight oil in 2019, indirectly affecting export sanctions – on Venezuela and Iran – and the attack on the giant Abqaiq facility in Saudi Arabia in September.
None of the geopolitical challenges of 2019 has gone away. But we can see signs already that the U.S. is refocusing on domestic policy in the run-up to the presidential election next November.
Source: Wood Mackenzie
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Friday, 28 June 24
INDIAN POWER STATIONS STOCKED WITH BUMPER COAL SUPPLY AS TRANSPORT WOES EASE - BUSINESS STANDARD
Even as power demand has touched a historic high of 250 gigawatts (Gw) amid sweltering heat this June, India’s power stations are stocked wit ...
Friday, 28 June 24
INDIA'S CY23 COAL USE LARGER THAN NORTH AMERICA, EUROPE COMBINED - THE HINDU
For the first time, India’s coal consumption surpassed that of North America and Europe combined in the calendar year 2023, said Energy Insti ...
Monday, 24 June 24
PLN'S FINANCIAL SUSTAINABILITY RESTS ON ACCELERATED COAL RETIREMENT AND RENEWABLES DEPLOYMENT - MUTYA YUSTIKA
On 28 May 2024, Indonesia’s national electricity utility, PT Perusahaan Listrik Negara (PLN), released its financial report for 2023. Althoug ...
Monday, 24 June 24
INDIA'S COAL-BASED POWER DEMAND AT ALL-TIME HIGH, GOVERNMENT SAYS - REUTERS
India’s demand for coal-based power has risen by 7.3% this fiscal year to an all-time high, the government said in a statement on Wednesday.
...
Monday, 24 June 24
CHINA'S COAL INDUSTRY TURNS GREENER THROUGH INNOVATIVE APPROACHES - PEOPLE'S DAILY
At an opencast mine operated by Inner Mongolia Pingzhuang Coal Group Co. Ltd., a subsidiary of CHN Energy Investment Group (CHN Energy), a 14-meter ...
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Showing 11 to 15 news of total 6871 |
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- Formosa Plastics Group - Taiwan
- Medco Energi Mining Internasional
- Singapore Mercantile Exchange
- Indogreen Group - Indonesia
- GAC Shipping (India) Pvt Ltd
- Ministry of Transport, Egypt
- Timah Investasi Mineral - Indoneisa
- Romanian Commodities Exchange
- The Treasury - Australian Government
- Orica Mining Services - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Ambuja Cements Ltd - India
- IEA Clean Coal Centre - UK
- Electricity Authority, New Zealand
- Madhucon Powers Ltd - India
- Larsen & Toubro Limited - India
- Aboitiz Power Corporation - Philippines
- Directorate General of MIneral and Coal - Indonesia
- Bulk Trading Sa - Switzerland
- Merrill Lynch Commodities Europe
- Kideco Jaya Agung - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Global Green Power PLC Corporation, Philippines
- Globalindo Alam Lestari - Indonesia
- Power Finance Corporation Ltd., India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Sindya Power Generating Company Private Ltd
- Cement Manufacturers Association - India
- Orica Australia Pty. Ltd.
- CIMB Investment Bank - Malaysia
- Indian Energy Exchange, India
- Antam Resourcindo - Indonesia
- Africa Commodities Group - South Africa
- Petron Corporation, Philippines
- Sakthi Sugars Limited - India
- Eastern Coal Council - USA
- Simpson Spence & Young - Indonesia
- Banpu Public Company Limited - Thailand
- Renaissance Capital - South Africa
- Coalindo Energy - Indonesia
- Coal and Oil Company - UAE
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Wilmar Investment Holdings
- Therma Luzon, Inc, Philippines
- PowerSource Philippines DevCo
- South Luzon Thermal Energy Corporation
- Heidelberg Cement - Germany
- Vijayanagar Sugar Pvt Ltd - India
- Indo Tambangraya Megah - Indonesia
- Star Paper Mills Limited - India
- Jaiprakash Power Ventures ltd
- Uttam Galva Steels Limited - India
- Deloitte Consulting - India
- Altura Mining Limited, Indonesia
- GVK Power & Infra Limited - India
- Sinarmas Energy and Mining - Indonesia
- Bukit Baiduri Energy - Indonesia
- Iligan Light & Power Inc, Philippines
- Posco Energy - South Korea
- ASAPP Information Group - India
- Bhoruka Overseas - Indonesia
- Indian Oil Corporation Limited
- Gujarat Sidhee Cement - India
- Eastern Energy - Thailand
- Standard Chartered Bank - UAE
- Indonesian Coal Mining Association
- Central Electricity Authority - India
- Trasteel International SA, Italy
- SMC Global Power, Philippines
- Malabar Cements Ltd - India
- TeaM Sual Corporation - Philippines
- Krishnapatnam Port Company Ltd. - India
- Tata Chemicals Ltd - India
- Chettinad Cement Corporation Ltd - India
- Siam City Cement - Thailand
- GN Power Mariveles Coal Plant, Philippines
- Straits Asia Resources Limited - Singapore
- Bahari Cakrawala Sebuku - Indonesia
- Georgia Ports Authority, United States
- Central Java Power - Indonesia
- European Bulk Services B.V. - Netherlands
- Neyveli Lignite Corporation Ltd, - India
- Rashtriya Ispat Nigam Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Bharathi Cement Corporation - India
- Oldendorff Carriers - Singapore
- Independent Power Producers Association of India
- Rio Tinto Coal - Australia
- Samtan Co., Ltd - South Korea
- Thai Mozambique Logistica
- New Zealand Coal & Carbon
- Riau Bara Harum - Indonesia
- IHS Mccloskey Coal Group - USA
- MS Steel International - UAE
- Bhushan Steel Limited - India
- Thiess Contractors Indonesia
- Sojitz Corporation - Japan
- Semirara Mining Corp, Philippines
- Sarangani Energy Corporation, Philippines
- Sical Logistics Limited - India
- Planning Commission, India
- Toyota Tsusho Corporation, Japan
- OPG Power Generation Pvt Ltd - India
- Kaltim Prima Coal - Indonesia
- Miang Besar Coal Terminal - Indonesia
- White Energy Company Limited
- Grasim Industreis Ltd - India
- Energy Development Corp, Philippines
- SN Aboitiz Power Inc, Philippines
- Siam City Cement PLC, Thailand
- Ceylon Electricity Board - Sri Lanka
- Price Waterhouse Coopers - Russia
- Xindia Steels Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Salva Resources Pvt Ltd - India
- Latin American Coal - Colombia
- Lanco Infratech Ltd - India
- PetroVietnam Power Coal Import and Supply Company
- Intertek Mineral Services - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Karaikal Port Pvt Ltd - India
- India Bulls Power Limited - India
- Metalloyd Limited - United Kingdom
- Mjunction Services Limited - India
- Gujarat Mineral Development Corp Ltd - India
- Tamil Nadu electricity Board
- The University of Queensland
- Sree Jayajothi Cements Limited - India
- Kohat Cement Company Ltd. - Pakistan
- Australian Coal Association
- Chamber of Mines of South Africa
- Kapuas Tunggal Persada - Indonesia
- Economic Council, Georgia
- Meralco Power Generation, Philippines
- Carbofer General Trading SA - India
- SMG Consultants - Indonesia
- Borneo Indobara - Indonesia
- Vizag Seaport Private Limited - India
- Kumho Petrochemical, South Korea
- GMR Energy Limited - India
- Commonwealth Bank - Australia
- Dalmia Cement Bharat India
- Cigading International Bulk Terminal - Indonesia
- Interocean Group of Companies - India
- Directorate Of Revenue Intelligence - India
- Aditya Birla Group - India
- Indika Energy - Indonesia
- PNOC Exploration Corporation - Philippines
- Gujarat Electricity Regulatory Commission - India
- VISA Power Limited - India
- Mercuria Energy - Indonesia
- Ministry of Mines - Canada
- The State Trading Corporation of India Ltd
- Alfred C Toepfer International GmbH - Germany
- Bhatia International Limited - India
- Global Coal Blending Company Limited - Australia
- Jindal Steel & Power Ltd - India
- Maheswari Brothers Coal Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Kartika Selabumi Mining - Indonesia
- Minerals Council of Australia
- Anglo American - United Kingdom
- Pendopo Energi Batubara - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- London Commodity Brokers - England
- CNBM International Corporation - China
- Ind-Barath Power Infra Limited - India
- Mercator Lines Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Manunggal Multi Energi - Indonesia
- Mintek Dendrill Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Savvy Resources Ltd - HongKong
- Energy Link Ltd, New Zealand
- Parry Sugars Refinery, India
- Marubeni Corporation - India
- AsiaOL BioFuels Corp., Philippines
- PTC India Limited - India
- LBH Netherlands Bv - Netherlands
- Leighton Contractors Pty Ltd - Australia
- Baramulti Group, Indonesia
- Meenaskhi Energy Private Limited - India
- Australian Commodity Traders Exchange
- Pipit Mutiara Jaya. PT, Indonesia
- Essar Steel Hazira Ltd - India
- McConnell Dowell - Australia
- Karbindo Abesyapradhi - Indoneisa
- Holcim Trading Pte Ltd - Singapore
- San Jose City I Power Corp, Philippines
- Bangladesh Power Developement Board
- Bukit Makmur.PT - Indonesia
- Makarim & Taira - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- ICICI Bank Limited - India
- Videocon Industries ltd - India
- Port Waratah Coal Services - Australia
- Kalimantan Lumbung Energi - Indonesia
- Barasentosa Lestari - Indonesia
- Agrawal Coal Company - India
- Global Business Power Corporation, Philippines
- Coastal Gujarat Power Limited - India
- Electricity Generating Authority of Thailand
- TNB Fuel Sdn Bhd - Malaysia
- Vedanta Resources Plc - India
- Kobexindo Tractors - Indoneisa
- Kepco SPC Power Corporation, Philippines
- Wood Mackenzie - Singapore
- Billiton Holdings Pty Ltd - Australia
- Attock Cement Pakistan Limited
- Bayan Resources Tbk. - Indonesia
- Goldman Sachs - Singapore
- Parliament of New Zealand
- Asmin Koalindo Tuhup - Indonesia
- Ministry of Finance - Indonesia
- Edison Trading Spa - Italy
- International Coal Ventures Pvt Ltd - India
- Binh Thuan Hamico - Vietnam
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