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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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Saturday, 21 March 20
PANAMAX: 82,000DWT SHIP AGREED $4,250 FOR A COAL TRIP VIA INDONESIA REDELIVERY SOUTH CHINA - BALTIC BRIEFING
Capesize
The Capesize market made some headway this past week despite being buffeted by the global pandemic storm. With the market in a constan ...
Friday, 20 March 20
CHINA'S BENCHMARK POWER COAL PRICE DROPS SLIGHTLY - XINHUA
China’s benchmark power coal price dropped slightly during the past week.
The Bohai-Rim Steam-Coal Price Index (BSPI), a gauge ...
Friday, 20 March 20
OIL PRICES COULD FALL BELOW ZERO: ANALYST - FOX BUSINESS
Plunging oil prices could be headed a lot lower – possibly below zero, according to one Wall Street analyst.
West Texas Interm ...
Friday, 20 March 20
84% OF FEBRUARY BUNKER SALES IN SINGAPORE ARE LOW-SULPHUR FUELS - BIMCO
Low-sulphur fuels accounted for 84% of total February sales in Singapore, slightly up from 83% in January. The sale of low-sulphur fuel oil (LSFO) ...
Thursday, 19 March 20
A CRUDE TSUNAMI: UP TO 3 MILLION BPD OF EXTRA OIL CAN HIT THE MARKET FROM APRIL, MORE COMING IN MAY - RYSTAD ENERGY
The extra oil coming into the global market from April will be as much as 3 million barrels per day (bpd), Rystad Energy estimates. Two million bpd ...
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Showing 1056 to 1060 news of total 6871 |
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- Africa Commodities Group - South Africa
- Mercuria Energy - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Maheswari Brothers Coal Limited - India
- The Treasury - Australian Government
- Star Paper Mills Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Carbofer General Trading SA - India
- Trasteel International SA, Italy
- Romanian Commodities Exchange
- Medco Energi Mining Internasional
- CNBM International Corporation - China
- Tata Chemicals Ltd - India
- Oldendorff Carriers - Singapore
- European Bulk Services B.V. - Netherlands
- Port Waratah Coal Services - Australia
- The University of Queensland
- Jindal Steel & Power Ltd - India
- Energy Link Ltd, New Zealand
- Minerals Council of Australia
- Parliament of New Zealand
- Lanco Infratech Ltd - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- New Zealand Coal & Carbon
- India Bulls Power Limited - India
- Kohat Cement Company Ltd. - Pakistan
- Eastern Coal Council - USA
- Indika Energy - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Jorong Barutama Greston.PT - Indonesia
- Agrawal Coal Company - India
- Banpu Public Company Limited - Thailand
- Ceylon Electricity Board - Sri Lanka
- Deloitte Consulting - India
- Samtan Co., Ltd - South Korea
- Electricity Generating Authority of Thailand
- Alfred C Toepfer International GmbH - Germany
- ASAPP Information Group - India
- Uttam Galva Steels Limited - India
- Xindia Steels Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Meralco Power Generation, Philippines
- Attock Cement Pakistan Limited
- Merrill Lynch Commodities Europe
- PNOC Exploration Corporation - Philippines
- International Coal Ventures Pvt Ltd - India
- Metalloyd Limited - United Kingdom
- PTC India Limited - India
- Billiton Holdings Pty Ltd - Australia
- Malabar Cements Ltd - India
- Power Finance Corporation Ltd., India
- Aboitiz Power Corporation - Philippines
- Offshore Bulk Terminal Pte Ltd, Singapore
- Georgia Ports Authority, United States
- Interocean Group of Companies - India
- Simpson Spence & Young - Indonesia
- Videocon Industries ltd - India
- Maharashtra Electricity Regulatory Commission - India
- Gujarat Electricity Regulatory Commission - India
- Australian Commodity Traders Exchange
- South Luzon Thermal Energy Corporation
- Salva Resources Pvt Ltd - India
- Sarangani Energy Corporation, Philippines
- Vizag Seaport Private Limited - India
- Leighton Contractors Pty Ltd - Australia
- The State Trading Corporation of India Ltd
- Antam Resourcindo - Indonesia
- Timah Investasi Mineral - Indoneisa
- Coal and Oil Company - UAE
- Planning Commission, India
- Global Green Power PLC Corporation, Philippines
- SMG Consultants - Indonesia
- Bukit Makmur.PT - Indonesia
- Global Business Power Corporation, Philippines
- Mjunction Services Limited - India
- Energy Development Corp, Philippines
- Chettinad Cement Corporation Ltd - India
- OPG Power Generation Pvt Ltd - India
- Bulk Trading Sa - Switzerland
- Ministry of Mines - Canada
- Gujarat Mineral Development Corp Ltd - India
- Pipit Mutiara Jaya. PT, Indonesia
- Wood Mackenzie - Singapore
- Kobexindo Tractors - Indoneisa
- Thai Mozambique Logistica
- Ind-Barath Power Infra Limited - India
- Singapore Mercantile Exchange
- Iligan Light & Power Inc, Philippines
- Kalimantan Lumbung Energi - Indonesia
- Larsen & Toubro Limited - India
- Pendopo Energi Batubara - Indonesia
- Rashtriya Ispat Nigam Limited - India
- MS Steel International - UAE
- Indogreen Group - Indonesia
- Gujarat Sidhee Cement - India
- Bharathi Cement Corporation - India
- Mintek Dendrill Indonesia
- Bangladesh Power Developement Board
- Makarim & Taira - Indonesia
- Kideco Jaya Agung - Indonesia
- Rio Tinto Coal - Australia
- Formosa Plastics Group - Taiwan
- Wilmar Investment Holdings
- Bukit Asam (Persero) Tbk - Indonesia
- Straits Asia Resources Limited - Singapore
- White Energy Company Limited
- San Jose City I Power Corp, Philippines
- Indian Energy Exchange, India
- Semirara Mining and Power Corporation, Philippines
- GAC Shipping (India) Pvt Ltd
- Dalmia Cement Bharat India
- Meenaskhi Energy Private Limited - India
- Posco Energy - South Korea
- Kapuas Tunggal Persada - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Sinarmas Energy and Mining - Indonesia
- Marubeni Corporation - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Latin American Coal - Colombia
- Central Electricity Authority - India
- Sree Jayajothi Cements Limited - India
- Standard Chartered Bank - UAE
- Coastal Gujarat Power Limited - India
- Parry Sugars Refinery, India
- Indian Oil Corporation Limited
- Ambuja Cements Ltd - India
- Global Coal Blending Company Limited - Australia
- Barasentosa Lestari - Indonesia
- Edison Trading Spa - Italy
- Heidelberg Cement - Germany
- Electricity Authority, New Zealand
- Goldman Sachs - Singapore
- Toyota Tsusho Corporation, Japan
- Central Java Power - Indonesia
- PowerSource Philippines DevCo
- Mercator Lines Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- SN Aboitiz Power Inc, Philippines
- Orica Mining Services - Indonesia
- Manunggal Multi Energi - Indonesia
- Aditya Birla Group - India
- Kartika Selabumi Mining - Indonesia
- VISA Power Limited - India
- Borneo Indobara - Indonesia
- Chamber of Mines of South Africa
- Vijayanagar Sugar Pvt Ltd - India
- Baramulti Group, Indonesia
- Bayan Resources Tbk. - Indonesia
- Binh Thuan Hamico - Vietnam
- Thiess Contractors Indonesia
- Independent Power Producers Association of India
- Price Waterhouse Coopers - Russia
- TeaM Sual Corporation - Philippines
- Bhoruka Overseas - Indonesia
- Altura Mining Limited, Indonesia
- Karaikal Port Pvt Ltd - India
- Economic Council, Georgia
- CIMB Investment Bank - Malaysia
- Sical Logistics Limited - India
- IEA Clean Coal Centre - UK
- TNB Fuel Sdn Bhd - Malaysia
- Siam City Cement PLC, Thailand
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Krishnapatnam Port Company Ltd. - India
- Australian Coal Association
- Semirara Mining Corp, Philippines
- Directorate Of Revenue Intelligence - India
- Indo Tambangraya Megah - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Kumho Petrochemical, South Korea
- Siam City Cement - Thailand
- Jaiprakash Power Ventures ltd
- PetroVietnam Power Coal Import and Supply Company
- Cement Manufacturers Association - India
- Indonesian Coal Mining Association
- Savvy Resources Ltd - HongKong
- Orica Australia Pty. Ltd.
- Eastern Energy - Thailand
- Therma Luzon, Inc, Philippines
- Riau Bara Harum - Indonesia
- Petron Corporation, Philippines
- Madhucon Powers Ltd - India
- Bhatia International Limited - India
- Ministry of Transport, Egypt
- Renaissance Capital - South Africa
- Intertek Mineral Services - Indonesia
- Commonwealth Bank - Australia
- AsiaOL BioFuels Corp., Philippines
- Grasim Industreis Ltd - India
- Essar Steel Hazira Ltd - India
- SMC Global Power, Philippines
- Globalindo Alam Lestari - Indonesia
- ICICI Bank Limited - India
- Anglo American - United Kingdom
- Asmin Koalindo Tuhup - Indonesia
- London Commodity Brokers - England
- Tamil Nadu electricity Board
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- LBH Netherlands Bv - Netherlands
- Miang Besar Coal Terminal - Indonesia
- Coalindo Energy - Indonesia
- Sojitz Corporation - Japan
- Sakthi Sugars Limited - India
- GMR Energy Limited - India
- GVK Power & Infra Limited - India
- Karbindo Abesyapradhi - Indoneisa
- Kepco SPC Power Corporation, Philippines
- Kaltim Prima Coal - Indonesia
- Sindya Power Generating Company Private Ltd
- Vedanta Resources Plc - India
- Bukit Baiduri Energy - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Ministry of Finance - Indonesia
- McConnell Dowell - Australia
- IHS Mccloskey Coal Group - USA
- Bhushan Steel Limited - India
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