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Friday, 20 March 20
VOLATILITY TO INCREASE IN TANKER MARKET FOLLOWING OIL PRICE WAR - DREWRY
Crude oil prices plunged by more than a third in the past week after OPEC+ failed to agree on production cut as demand softened in the aftermath of coronavirus (COVID-19). In its recent report, the IEA estimates global oil demand at 99.9 mbpd in 2020, which is around 90,000 bpd lower than in 2019 and a sharp downgrade from the agency’s forecast in February, which predicted global oil demand will grow 825,000 bpd in 2020.
The market expected OPEC+ to cut supply as the COVID-19 epidemic has spread from China to Europe, the Americas and Middle East. However, the negotiations failed due to strong resistance from Russia, which is of the view that the policy of capping production by OPEC+ producers to support the oil price is facilitating the development of US shale oil, with Russia losing its market share to increasing exports from the US.
After the failure of production cut talks in Vienna, Saudi Arabia started a price war by slashing the official selling prices for crude for key buyers in the international market and hinted at raising crude oil production to full capacity of 12.3 mbpd from April 2020. The ‘shock and awe’ tactics of Saudi Arabia could be a move to impose maximum pain in the quickest possible way to Russia and other producers, in an effort to renegotiate the proposed production cut and then quickly reverse the production surge and thereafter implement the production cut if a deal is reached.
However, the recent move by Saudi Arabia could lead to:
a) Renegotiation on a production cut between OPEC and Russia
b) Prolonged price war between OPEC, Russia and US producers
If there are fresh negotiations to implement a production cut by OPEC+ producers to accommodate the effect of declining oil demand, crude oil prices are expected to normalise.
But if there is a prolonged price war between Saudi Arabia, Russia and US shale oil producers, lower crude oil prices will lead to some improvement in global oil demand and refinery runs. At the same time, onshore stocking activity will also increase, especially in countries such as China as they build their Strategic Petroleum Reserve. A global supply glut is also likely to lead to an increase in floating storage especially among oil producers.
At the same time, sustained weakness in oil prices will eventually hurt US shale oil producers because of their relatively higher cost of production. In such circumstances, the market share of Middle Eastern crude will increase at the expense of US crude.
Meanwhile, tanker rates surged due to a sudden increase in VLCC chartering from Bahri, Saudi Arabia’s national shipping arm. Bahri fixed at least 18 VLCCs since the Kingdom aims to pump more crude into the market as its price war with Russia escalates. The VLCC earnings on Middle East–China (TD3C) route skyrocketed to $166,000pd on 11 March from $30,300pd on 06 March.
If Saudi Arabia manages to strike a deal with Russia to cut production in the short term, tanker rates will plummet to the pre-price war levels because of the ongoing weakness in crude oil trade on account of the spread of COVID-19 globally. On the other hand, if there is a prolonged price war, tonnage demand will rise initially with the increase in oil demand and stocking activity, which in turn will keep freight rates above pre-price war levels.
However, once sustained weakness in oil prices starts hurting US crude production, Middle Eastern crude will start displacing US crude in Asia. This in turn will squeeze tonne-mile demand for tankers as the distance between the US to Asia is almost double the distance between the Middle East to Asia. Thus we estimate that every barrel per day of annual decline in US exports to Asia at the expense of the Middle East will lead to about a 2.5% decline in overall tonne-mile demand for tankers. Freight rates in such a situation will plunge below the pre-price war levels.
Source: Drewry
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Friday, 10 April 20
INDIA'S BULKS SUPPLY CHAIN TAKES A HIT DURING LOCKDOWN - WOOD MACKENZIE
India is under a three-week lockdown from 25 March to contain the spread of the coronavirus outbreak. Businesses are shut, and the supply chain is ...
Thursday, 09 April 20
SUSPENSION OF WRONGFUL TRADING IN LIGHT OF COVID 19 - WF&W
KNOWLEDGE TO ELEVATE
DIRECTORS’ PERSONAL LIABILITY FOR WRONGFUL TRADING – RELIEF DURING THE CORONAVIRUS CRISIS
As the UK&rsquo ...
Wednesday, 08 April 20
LESSONS LEARNED FROM SCRUBBER INSTALLATION AND OPERATION - ABS
KNOWLEDGE TO ELEVATE
At the beginning of this year, the IMO’s global sulfur cap on marine fuels entered into force and shipowners who ch ...
Wednesday, 08 April 20
MARKET INSIGHT - INTERMODAL
With lockdown measures around the globe tightening during the last weeks of Q1, there is finally a feeling that most countries are slowly but stead ...
Tuesday, 07 April 20
SHIPPING MARKET ANALYSIS - ALLIED
With the first quarter of 2020 now firmly written in the books, it is worth examining what we have witnessed so far in the tanker market. Undoubted ...
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Showing 1021 to 1025 news of total 6871 |
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- Banpu Public Company Limited - Thailand
- Rio Tinto Coal - Australia
- MS Steel International - UAE
- Madhucon Powers Ltd - India
- South Luzon Thermal Energy Corporation
- European Bulk Services B.V. - Netherlands
- Vedanta Resources Plc - India
- Kapuas Tunggal Persada - Indonesia
- Indonesian Coal Mining Association
- Straits Asia Resources Limited - Singapore
- Attock Cement Pakistan Limited
- Carbofer General Trading SA - India
- The University of Queensland
- Price Waterhouse Coopers - Russia
- Sree Jayajothi Cements Limited - India
- Kideco Jaya Agung - Indonesia
- Intertek Mineral Services - Indonesia
- GMR Energy Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Agrawal Coal Company - India
- Bahari Cakrawala Sebuku - Indonesia
- Gujarat Electricity Regulatory Commission - India
- TeaM Sual Corporation - Philippines
- Wilmar Investment Holdings
- Aboitiz Power Corporation - Philippines
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Directorate Of Revenue Intelligence - India
- Malabar Cements Ltd - India
- Kartika Selabumi Mining - Indonesia
- The State Trading Corporation of India Ltd
- London Commodity Brokers - England
- Planning Commission, India
- Jaiprakash Power Ventures ltd
- Therma Luzon, Inc, Philippines
- Bank of Tokyo Mitsubishi UFJ Ltd
- Bangladesh Power Developement Board
- Goldman Sachs - Singapore
- Ministry of Mines - Canada
- IEA Clean Coal Centre - UK
- CIMB Investment Bank - Malaysia
- PowerSource Philippines DevCo
- Cigading International Bulk Terminal - Indonesia
- Ministry of Transport, Egypt
- Parry Sugars Refinery, India
- Bharathi Cement Corporation - India
- Coal and Oil Company - UAE
- Ambuja Cements Ltd - India
- TNB Fuel Sdn Bhd - Malaysia
- Singapore Mercantile Exchange
- Grasim Industreis Ltd - India
- Sical Logistics Limited - India
- Rashtriya Ispat Nigam Limited - India
- Binh Thuan Hamico - Vietnam
- Indo Tambangraya Megah - Indonesia
- Medco Energi Mining Internasional
- Leighton Contractors Pty Ltd - Australia
- Xindia Steels Limited - India
- CNBM International Corporation - China
- Global Green Power PLC Corporation, Philippines
- Metalloyd Limited - United Kingdom
- Kaltim Prima Coal - Indonesia
- Chettinad Cement Corporation Ltd - India
- Iligan Light & Power Inc, Philippines
- Lanco Infratech Ltd - India
- SMC Global Power, Philippines
- Karaikal Port Pvt Ltd - India
- Energy Development Corp, Philippines
- Essar Steel Hazira Ltd - India
- Bukit Makmur.PT - Indonesia
- Mercuria Energy - Indonesia
- San Jose City I Power Corp, Philippines
- LBH Netherlands Bv - Netherlands
- Vizag Seaport Private Limited - India
- Bayan Resources Tbk. - Indonesia
- Thiess Contractors Indonesia
- Tata Chemicals Ltd - India
- Global Coal Blending Company Limited - Australia
- Electricity Generating Authority of Thailand
- Interocean Group of Companies - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Sarangani Energy Corporation, Philippines
- Meenaskhi Energy Private Limited - India
- Samtan Co., Ltd - South Korea
- Mercator Lines Limited - India
- Power Finance Corporation Ltd., India
- Mjunction Services Limited - India
- Anglo American - United Kingdom
- ASAPP Information Group - India
- Latin American Coal - Colombia
- Kepco SPC Power Corporation, Philippines
- SN Aboitiz Power Inc, Philippines
- Energy Link Ltd, New Zealand
- Kalimantan Lumbung Energi - Indonesia
- Bukit Baiduri Energy - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Timah Investasi Mineral - Indoneisa
- Indika Energy - Indonesia
- Central Electricity Authority - India
- Bulk Trading Sa - Switzerland
- Bhatia International Limited - India
- Siam City Cement - Thailand
- Gujarat Sidhee Cement - India
- GVK Power & Infra Limited - India
- Semirara Mining Corp, Philippines
- Minerals Council of Australia
- Posco Energy - South Korea
- IHS Mccloskey Coal Group - USA
- Thai Mozambique Logistica
- Formosa Plastics Group - Taiwan
- Tamil Nadu electricity Board
- Merrill Lynch Commodities Europe
- Riau Bara Harum - Indonesia
- Maheswari Brothers Coal Limited - India
- Toyota Tsusho Corporation, Japan
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Electricity Authority, New Zealand
- Orica Australia Pty. Ltd.
- Kohat Cement Company Ltd. - Pakistan
- Indogreen Group - Indonesia
- Altura Mining Limited, Indonesia
- International Coal Ventures Pvt Ltd - India
- Romanian Commodities Exchange
- Renaissance Capital - South Africa
- Savvy Resources Ltd - HongKong
- Global Business Power Corporation, Philippines
- Videocon Industries ltd - India
- GN Power Mariveles Coal Plant, Philippines
- McConnell Dowell - Australia
- Pipit Mutiara Jaya. PT, Indonesia
- Salva Resources Pvt Ltd - India
- Coastal Gujarat Power Limited - India
- Parliament of New Zealand
- Billiton Holdings Pty Ltd - Australia
- Deloitte Consulting - India
- Oldendorff Carriers - Singapore
- Sojitz Corporation - Japan
- Chamber of Mines of South Africa
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Karbindo Abesyapradhi - Indoneisa
- Economic Council, Georgia
- Miang Besar Coal Terminal - Indonesia
- Bhushan Steel Limited - India
- Sindya Power Generating Company Private Ltd
- Gujarat Mineral Development Corp Ltd - India
- Siam City Cement PLC, Thailand
- Baramulti Group, Indonesia
- Trasteel International SA, Italy
- Meralco Power Generation, Philippines
- PTC India Limited - India
- Orica Mining Services - Indonesia
- Wood Mackenzie - Singapore
- Manunggal Multi Energi - Indonesia
- Jindal Steel & Power Ltd - India
- Barasentosa Lestari - Indonesia
- ICICI Bank Limited - India
- OPG Power Generation Pvt Ltd - India
- Petrochimia International Co. Ltd.- Taiwan
- The Treasury - Australian Government
- Simpson Spence & Young - Indonesia
- GAC Shipping (India) Pvt Ltd
- Commonwealth Bank - Australia
- Alfred C Toepfer International GmbH - Germany
- Petron Corporation, Philippines
- Central Java Power - Indonesia
- Borneo Indobara - Indonesia
- Ministry of Finance - Indonesia
- Holcim Trading Pte Ltd - Singapore
- SMG Consultants - Indonesia
- Makarim & Taira - Indonesia
- Eastern Coal Council - USA
- Star Paper Mills Limited - India
- Africa Commodities Group - South Africa
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Independent Power Producers Association of India
- Pendopo Energi Batubara - Indonesia
- Heidelberg Cement - Germany
- Jorong Barutama Greston.PT - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- India Bulls Power Limited - India
- Indian Oil Corporation Limited
- Kobexindo Tractors - Indoneisa
- New Zealand Coal & Carbon
- PNOC Exploration Corporation - Philippines
- White Energy Company Limited
- Cement Manufacturers Association - India
- Maharashtra Electricity Regulatory Commission - India
- Semirara Mining and Power Corporation, Philippines
- VISA Power Limited - India
- Bhoruka Overseas - Indonesia
- Marubeni Corporation - India
- Eastern Energy - Thailand
- Australian Commodity Traders Exchange
- Larsen & Toubro Limited - India
- Globalindo Alam Lestari - Indonesia
- Antam Resourcindo - Indonesia
- Ind-Barath Power Infra Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Uttam Galva Steels Limited - India
- Coalindo Energy - Indonesia
- Georgia Ports Authority, United States
- Indian Energy Exchange, India
- Australian Coal Association
- Dalmia Cement Bharat India
- Port Waratah Coal Services - Australia
- Aditya Birla Group - India
- Sinarmas Energy and Mining - Indonesia
- Standard Chartered Bank - UAE
- Directorate General of MIneral and Coal - Indonesia
- Kumho Petrochemical, South Korea
- Bukit Asam (Persero) Tbk - Indonesia
- Sakthi Sugars Limited - India
- Krishnapatnam Port Company Ltd. - India
- AsiaOL BioFuels Corp., Philippines
- Mintek Dendrill Indonesia
- Edison Trading Spa - Italy
- Vijayanagar Sugar Pvt Ltd - India
- Ceylon Electricity Board - Sri Lanka
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