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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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Tuesday, 31 March 20
CHINA TAIYUAN COAL TRANSACTION PRICE INDEX DOWN 0.43 PCT - XINHUA
China Taiyuan coal transaction price index stood at 132.17 points Monday, down 0.43 percent week on week.
The index, released by Chi ...
Tuesday, 31 March 20
COAL POWER REMAINS IN GLOBAL DECLINE, DESPITE CHINESE SURGE - SYDNEY MORNING HERALD
The impact of coronavirus has prompted a surge in coal-fired power plant construction permits in China, with the Chinese government issuing more pe ...
Monday, 30 March 20
CORONAVIRUS - IMPLICATIONS FOR SHIPS AND CREW - GARD
KNOWLEDGE TO ELEVATE
Countries around the world are strengthening their border control measures in order to prevent the further spread of COVI ...
Monday, 30 March 20
LAY-UP AND RE-ACTIVATION REVISITED - GARD
KNOWLEDGE TO ELEVATE
The COVID-19 pandemic has affected the maritime industry in previously unthinkable ways. Ports around the world are denyi ...
Monday, 30 March 20
PANAMAX: INDONESIA LACKED VOLUME, PARTLY DUE TO FORCE MAJEURE IN INDIAN PORTS - BALTIC BRIEFING
Capesize
As Covid-19 continued to ratchet up tensions across the globe, the Cape market dealt with the change to remote working. Most regions o ...
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Showing 1036 to 1040 news of total 6871 |
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- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Metalloyd Limited - United Kingdom
- Global Green Power PLC Corporation, Philippines
- Anglo American - United Kingdom
- Rashtriya Ispat Nigam Limited - India
- Bhoruka Overseas - Indonesia
- New Zealand Coal & Carbon
- Kartika Selabumi Mining - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Tata Chemicals Ltd - India
- Heidelberg Cement - Germany
- Goldman Sachs - Singapore
- PetroVietnam Power Coal Import and Supply Company
- Agrawal Coal Company - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Mintek Dendrill Indonesia
- Chamber of Mines of South Africa
- Semirara Mining Corp, Philippines
- Indogreen Group - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- CNBM International Corporation - China
- Therma Luzon, Inc, Philippines
- Semirara Mining and Power Corporation, Philippines
- Siam City Cement PLC, Thailand
- Parliament of New Zealand
- Indonesian Coal Mining Association
- Chettinad Cement Corporation Ltd - India
- Mercator Lines Limited - India
- Vedanta Resources Plc - India
- MS Steel International - UAE
- Uttam Galva Steels Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Indika Energy - Indonesia
- Marubeni Corporation - India
- Pipit Mutiara Jaya. PT, Indonesia
- Commonwealth Bank - Australia
- Tamil Nadu electricity Board
- Karaikal Port Pvt Ltd - India
- TeaM Sual Corporation - Philippines
- Indian Energy Exchange, India
- LBH Netherlands Bv - Netherlands
- Kumho Petrochemical, South Korea
- SN Aboitiz Power Inc, Philippines
- Indian Oil Corporation Limited
- Altura Mining Limited, Indonesia
- Pendopo Energi Batubara - Indonesia
- Bulk Trading Sa - Switzerland
- Ceylon Electricity Board - Sri Lanka
- Eastern Coal Council - USA
- Bank of Tokyo Mitsubishi UFJ Ltd
- Standard Chartered Bank - UAE
- Deloitte Consulting - India
- Petron Corporation, Philippines
- SMC Global Power, Philippines
- Mjunction Services Limited - India
- Alfred C Toepfer International GmbH - Germany
- IEA Clean Coal Centre - UK
- OPG Power Generation Pvt Ltd - India
- Gujarat Electricity Regulatory Commission - India
- Riau Bara Harum - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Eastern Energy - Thailand
- Intertek Mineral Services - Indonesia
- Orica Mining Services - Indonesia
- Planning Commission, India
- Iligan Light & Power Inc, Philippines
- Electricity Generating Authority of Thailand
- Bangladesh Power Developement Board
- Attock Cement Pakistan Limited
- Orica Australia Pty. Ltd.
- TNB Fuel Sdn Bhd - Malaysia
- Sical Logistics Limited - India
- Kaltim Prima Coal - Indonesia
- Rio Tinto Coal - Australia
- Kohat Cement Company Ltd. - Pakistan
- Videocon Industries ltd - India
- GN Power Mariveles Coal Plant, Philippines
- Coal and Oil Company - UAE
- VISA Power Limited - India
- Maheswari Brothers Coal Limited - India
- Cigading International Bulk Terminal - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Borneo Indobara - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Wilmar Investment Holdings
- Miang Besar Coal Terminal - Indonesia
- White Energy Company Limited
- Siam City Cement - Thailand
- Bhushan Steel Limited - India
- Carbofer General Trading SA - India
- Georgia Ports Authority, United States
- PTC India Limited - India
- GVK Power & Infra Limited - India
- Romanian Commodities Exchange
- Aditya Birla Group - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Globalindo Alam Lestari - Indonesia
- The University of Queensland
- Wood Mackenzie - Singapore
- Posco Energy - South Korea
- Bharathi Cement Corporation - India
- The Treasury - Australian Government
- Thiess Contractors Indonesia
- Krishnapatnam Port Company Ltd. - India
- Kideco Jaya Agung - Indonesia
- Jaiprakash Power Ventures ltd
- Ministry of Transport, Egypt
- Merrill Lynch Commodities Europe
- Ministry of Finance - Indonesia
- Jindal Steel & Power Ltd - India
- Sojitz Corporation - Japan
- Global Coal Blending Company Limited - Australia
- India Bulls Power Limited - India
- Grasim Industreis Ltd - India
- PNOC Exploration Corporation - Philippines
- Samtan Co., Ltd - South Korea
- Directorate Of Revenue Intelligence - India
- Simpson Spence & Young - Indonesia
- Australian Commodity Traders Exchange
- Central Electricity Authority - India
- Xindia Steels Limited - India
- London Commodity Brokers - England
- CIMB Investment Bank - Malaysia
- San Jose City I Power Corp, Philippines
- Global Business Power Corporation, Philippines
- Indo Tambangraya Megah - Indonesia
- PowerSource Philippines DevCo
- Thai Mozambique Logistica
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- ICICI Bank Limited - India
- Billiton Holdings Pty Ltd - Australia
- Australian Coal Association
- IHS Mccloskey Coal Group - USA
- Sarangani Energy Corporation, Philippines
- Salva Resources Pvt Ltd - India
- Directorate General of MIneral and Coal - Indonesia
- International Coal Ventures Pvt Ltd - India
- Malabar Cements Ltd - India
- Energy Link Ltd, New Zealand
- Antam Resourcindo - Indonesia
- The State Trading Corporation of India Ltd
- Bukit Makmur.PT - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Minerals Council of Australia
- Economic Council, Georgia
- Leighton Contractors Pty Ltd - Australia
- Toyota Tsusho Corporation, Japan
- Meenaskhi Energy Private Limited - India
- Kapuas Tunggal Persada - Indonesia
- Lanco Infratech Ltd - India
- Power Finance Corporation Ltd., India
- Sindya Power Generating Company Private Ltd
- Gujarat Mineral Development Corp Ltd - India
- Banpu Public Company Limited - Thailand
- Medco Energi Mining Internasional
- Formosa Plastics Group - Taiwan
- Sinarmas Energy and Mining - Indonesia
- GAC Shipping (India) Pvt Ltd
- Manunggal Multi Energi - Indonesia
- Gujarat Sidhee Cement - India
- Ministry of Mines - Canada
- Sree Jayajothi Cements Limited - India
- Oldendorff Carriers - Singapore
- Neyveli Lignite Corporation Ltd, - India
- European Bulk Services B.V. - Netherlands
- AsiaOL BioFuels Corp., Philippines
- ASAPP Information Group - India
- Meralco Power Generation, Philippines
- Renaissance Capital - South Africa
- Coalindo Energy - Indonesia
- Madhucon Powers Ltd - India
- Star Paper Mills Limited - India
- Interocean Group of Companies - India
- Savvy Resources Ltd - HongKong
- Petrochimia International Co. Ltd.- Taiwan
- Ambuja Cements Ltd - India
- Binh Thuan Hamico - Vietnam
- Baramulti Group, Indonesia
- Barasentosa Lestari - Indonesia
- Timah Investasi Mineral - Indoneisa
- Holcim Trading Pte Ltd - Singapore
- Mercuria Energy - Indonesia
- Electricity Authority, New Zealand
- McConnell Dowell - Australia
- Price Waterhouse Coopers - Russia
- Singapore Mercantile Exchange
- Larsen & Toubro Limited - India
- South Luzon Thermal Energy Corporation
- Edison Trading Spa - Italy
- Central Java Power - Indonesia
- SMG Consultants - Indonesia
- Latin American Coal - Colombia
- Cement Manufacturers Association - India
- Ind-Barath Power Infra Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Vizag Seaport Private Limited - India
- Africa Commodities Group - South Africa
- GMR Energy Limited - India
- Kobexindo Tractors - Indoneisa
- Port Waratah Coal Services - Australia
- Aboitiz Power Corporation - Philippines
- Essar Steel Hazira Ltd - India
- Bayan Resources Tbk. - Indonesia
- Bhatia International Limited - India
- Kepco SPC Power Corporation, Philippines
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Independent Power Producers Association of India
- Vijayanagar Sugar Pvt Ltd - India
- Sakthi Sugars Limited - India
- Coastal Gujarat Power Limited - India
- Dalmia Cement Bharat India
- Energy Development Corp, Philippines
- Parry Sugars Refinery, India
- Trasteel International SA, Italy
- Straits Asia Resources Limited - Singapore
- Makarim & Taira - Indonesia
- Bukit Baiduri Energy - Indonesia
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