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Friday, 17 April 20
OPEC BRACES FOR OIL MARKET'S "HISTORIC SHOCK"
 OPEC released its much anticipated April monthly report.
Crude Oil Price Movements
Crude oil prices collapsed in March 2020, recording their deepest monthly drop since the global financial crisis in 2008. The ramifications of the COVID-19 pandemic were the main driving force, resulting in unprecedented worldwide oil demand shock and massive sell-offs in the global oil markets, amid a significant crude surplus. The OPEC Reference Basket (ORB) value was down by $21.61, or 38.9%, m-o-m, to stand at $33.92/b, the lowest monthly value since September 2003. ICE Brent declined by $21.75, or 39.2%, m-o-m, to average $33.73/b, while NYMEX WTI fell $20.09, or 39.8%, to average $30.45/b. The term structure of all three crude benchmarks – ICE Brent, NYMEX WTI and DME Oman – moved to a super contango in March, and money managers cut speculative net long positions.
World Economy
The world economy is forecast to face a severe recession in 2020, declining by 1.5%, following global economic growth of 2.9% in the previous year. Following tender signs of improvement at the beginning of the year, expectations for global economic growth were quickly burdened by the strong impact of the COVID-19 pandemic. Within the OECD, the US is forecast to contract by 4.1% in 2020, following growth of 2.3% in 2019. An even larger decline is expected in the Euro-zone, where economic activity is forecast to fall by 6.0% in 2020, compared to growth of 1.2% in 2019. Japan is forecast to contract by 3.9% in 2020, comparing to growth of 0.7% in 2019. China’s 2020 GDP is forecast to grow by 1.5%, recovering from a sharp contraction in 1Q20 and following growth of 6.1% in 2019. India is forecast to grow by only 2.0%, a sharp slowdown from already weakening growth of 5.3% in 2019. Brazil’s economy is forecast to contract by 2.4% in 2020, following growth of 1.0% in 2019. Russia’s economy is forecast to contract by 0.5% in 2020, after growth of 1.4% in 2019, not only due to COVID-19, but also because of the considerable decline in oil prices. As risk remains to be skewed to the downside, further revisions may be warranted going forward.
World Oil Demand
World oil demand growth forecast for 2019 is kept unchanged at 0.83 mb/d, compared with the previous month’s assessment. For 2020, the world oil demand growth forecast is revised lower by 6.9 mb/d, to a historical drop of around 6.8 mb/d. The contraction in the 2Q of this year is expected to be around 12 mb/d, with April witnessing the worst contraction at about 20 mb/d. The impact of the COVID-19 outbreak in China in 1Q20, and its negative impact on transportation and industrial fuels in the country, has since spread globally and is now affecting oil demand growth in most other countries and regions, with an unprecedented impact on global oil demand, transportation fuels in particular. As a result, OECD oil demand is revised lower by 3.7 mb/d to decline by 4.0 mb/d, while non-OECD oil demand growth is adjusted lower by 3.2 mb/d to contract by 2.9 mb/d for the year. Considering latest developments, and the large uncertainties going forward, downward risks remain significant, suggesting possibility of further adjustments, especially in the 2Q, should new data and further developments warrant revisions.
World Oil Supply Non-OPEC oil supply growth in 2019 is revised down by 0.01 mb/d from the previous month’s assessment and is now estimated at 1.98 mb/d. For 2020, non-OPEC oil supply is forecast to decline by 1.50 mb/d, a downward revision of 3.26 mb/d from the previous projection. The impact of COVID-19, ensuing global economic recession and oil demand shock, will also lead to supply disruptions. Benchmark oil prices plunge prompted companies to respond by cutting capital expenditure to the lowest in 13 years. The 2020 oil supply growth forecast for the US was revised down by 1.05 mb/d to show a decline of 0.15 mb/d y-o-y. The supply growth for the 10 non-OPEC countries participating in the Declaration of Cooperation has also been adjusted lower. Oil supply in 2020 is now forecast to show growth only in Norway, Brazil, Guyana and Australia. OPEC NGLs production in 2019 is estimated to have grown by 0.04 mb/d to average 4.79 mb/d and for 2020 will grow by 0.04 mb/d to average 4.83 mb/d. In March, OPEC crude oil production increased by 821 tb/d m-o-m to average 28.61 mb/d, according to secondary sources.
Product Markets and Refining Operations
Global refinery margins globally showed mixed performance during March. In the US, margins weakened as strength in gasoil/diesel was offset by losses in gasoline cracks, as complex margins came close to negative territory. In Europe, product markets strengthened slightly at the middle of the barrel, supported by a fall in feedstock prices. An already relatively tight global gasoil market saw support from output cuts and continued critical industrial activities for essential services and goods amid COVID-19. However, in Asia, margins eased towards the end of the month, pressured by a weaker top of the barrel, despite healthy gasoil and fuel oil crack spreads.
Tanker Market
The tanker market has been one of few segments of the oil industry that enjoyed positive momentum in March. A sudden surge in crude exports boosted demand for VLCCs, which pulled up Suezmax rates as well. Dirty spot freight rates declined mid-month before climbing again as the market was supported by high demand for tankers as charterers rushed to place cargoes amid a collapse in demand due to the COVID-19 pandemic. Increased options for time-chartering, including for floating storage, underscored the build-up of excess supply of crude and products in the market. For the month, dirty spot rates averaged 69% higher m-o-m in March. Clean tanker spot freight rates rose 12% m-o-m, as the need to find homes for excess product supplies supported the market.
Trade
Crude and product trade flows have been notably affected by the COVID-19 pandemic and the uncertain outlook going forward, although there has been some lag in how the various regions have been affected. US crude exports had a strong start to the year, averaging 3.5 mb/d in 1Q20, a gain of 0.8 mb/d over the same quarter last year, as the US remained a net liquids exporter for the seventh-consecutive month. Meanwhile, China’s crude imports averaged 10.5 mb/d over the first two months of 2020, declining from December as disruptions caused by COVID-19 led to some imports being diverted or delayed. Product trade was also affected, with imports and exports averaging 0.3 mb/d lower in the first two months of the year compared to December. Official data showed India’s crude imports increasing slightly in February, although some estimates show a higher jump as the country took in some discounted cargoes diverted from China. India’s crude and product trade is likely to be broadly impacted in March by a government-ordered lockdown.
Stock Movements
OECD commercial oil stocks rose by 5.6 mb, m-o-m, in February to stand at 2,945 mb. This was 64.3 mb higher than the same time one year ago and 24.7 mb above the latest five-year average. Within components, crude stocks fell by 6.1 mb, while product stocks rose by 11.7 mb, m-o-m. In terms of days of forward cover, OECD commercial stocks rose by 5.0 days, m-o-m, in February to stand at 72.7 days. This was 11.5 days above the same period in 2019, and 10.3 days above the latest five-year average. Preliminary data for March showed that US total commercial oil stocks increased by 8.2 mb, m-o-m, to stand at 1,922 mb. This was 31.8 mb, or 1.7%, above the same period a year ago, and 16.2 mb, or 0.8%, lower than the latest five-year average. Within components, crude stocks rose by 25.1 mb, while product stocks fell by 16.8 mb, m-o-m.
Balance of Supply and Demand
Demand for OPEC crude in 2019 stood at 29.9 mb/d, 1.2 mb/d lower than the 2018 level. Following the recent agreement reached at the extraordinary OPEC and non-OPEC Ministerial Meetings, the demand for OPEC crude in 2020 is expected at 24.5 mb/d, around 5.4 mb/d lower than the 2019 level, though this remains heavily subject to uncertainty surrounding current market conditions.
Source: OPEC
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Tuesday, 07 July 20
WHAT DOES THE PATHWAY TO A NET-ZERO ECONOMY LOOK LIKE FOR MINERS? - WOOD MACKENZIE
Wind, solar, electric vehicles, stationary storage and transmission are all central to achieving the Paris Agreement decarbonisation goals.
&nb ...
Monday, 06 July 20
INDONESIAN COAL PRICE REFERENCE IN FREE FALL
COALspot.com: The Ministry of Energy and Mineral Resources of the Republic of Indonesia has revised down again the benchmark price of Indonesian th ...
Monday, 06 July 20
SUPRAMAX: A 58,000-DWT FIXING DELIVERY VIETNAM TRIP VIA INDONESIA RE-DELIVERY WEST INDIA IN THE LOW $4,000S
Capesize
The Capesize market continues to go from strength to strength, as rates reach highs not seen since September last year. The rally is p ...
Thursday, 02 July 20
PRIVATE COAL MINING MAY SEE WEAK INVESTOR SENTIMENT: ICRA - LIVEMINT
The prospects of commercial coal mining in India may be dimmer than initially expected because of the expected shift in India’s energy mix fr ...
Wednesday, 01 July 20
THERMAL COAL OPTIONS TRADING LAUNCHED IN CHINA'S ZHENGZHOU - XINHUA
Thermal coal options started trading on the Zhengzhou Commodity Exchange (ZCE) in central China’s Henan Province Tuesday.
It i ...
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- Star Paper Mills Limited - India
- Renaissance Capital - South Africa
- Jindal Steel & Power Ltd - India
- Energy Development Corp, Philippines
- Mintek Dendrill Indonesia
- Mercuria Energy - Indonesia
- Sojitz Corporation - Japan
- Barasentosa Lestari - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Bhushan Steel Limited - India
- Goldman Sachs - Singapore
- Cigading International Bulk Terminal - Indonesia
- Chettinad Cement Corporation Ltd - India
- Coastal Gujarat Power Limited - India
- Medco Energi Mining Internasional
- Kepco SPC Power Corporation, Philippines
- Marubeni Corporation - India
- Makarim & Taira - Indonesia
- CIMB Investment Bank - Malaysia
- Gujarat Electricity Regulatory Commission - India
- Bukit Baiduri Energy - Indonesia
- Metalloyd Limited - United Kingdom
- Independent Power Producers Association of India
- Kalimantan Lumbung Energi - Indonesia
- Bhoruka Overseas - Indonesia
- Ambuja Cements Ltd - India
- The State Trading Corporation of India Ltd
- Petron Corporation, Philippines
- Wood Mackenzie - Singapore
- Semirara Mining and Power Corporation, Philippines
- Kartika Selabumi Mining - Indonesia
- Samtan Co., Ltd - South Korea
- Ind-Barath Power Infra Limited - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Australian Coal Association
- Bharathi Cement Corporation - India
- Ministry of Transport, Egypt
- Romanian Commodities Exchange
- Pipit Mutiara Jaya. PT, Indonesia
- Lanco Infratech Ltd - India
- OPG Power Generation Pvt Ltd - India
- Trasteel International SA, Italy
- PNOC Exploration Corporation - Philippines
- PowerSource Philippines DevCo
- Meenaskhi Energy Private Limited - India
- Mercator Lines Limited - India
- Eastern Coal Council - USA
- Therma Luzon, Inc, Philippines
- Neyveli Lignite Corporation Ltd, - India
- AsiaOL BioFuels Corp., Philippines
- GAC Shipping (India) Pvt Ltd
- Videocon Industries ltd - India
- Karaikal Port Pvt Ltd - India
- Petrochimia International Co. Ltd.- Taiwan
- Alfred C Toepfer International GmbH - Germany
- Meralco Power Generation, Philippines
- Attock Cement Pakistan Limited
- Ministry of Mines - Canada
- Savvy Resources Ltd - HongKong
- GVK Power & Infra Limited - India
- Sree Jayajothi Cements Limited - India
- Electricity Authority, New Zealand
- Madhucon Powers Ltd - India
- Port Waratah Coal Services - Australia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Leighton Contractors Pty Ltd - Australia
- Australian Commodity Traders Exchange
- Merrill Lynch Commodities Europe
- Latin American Coal - Colombia
- Global Green Power PLC Corporation, Philippines
- Coal and Oil Company - UAE
- International Coal Ventures Pvt Ltd - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Kohat Cement Company Ltd. - Pakistan
- IEA Clean Coal Centre - UK
- Kideco Jaya Agung - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Toyota Tsusho Corporation, Japan
- Sical Logistics Limited - India
- Asmin Koalindo Tuhup - Indonesia
- Standard Chartered Bank - UAE
- Gujarat Sidhee Cement - India
- Altura Mining Limited, Indonesia
- Jaiprakash Power Ventures ltd
- The Treasury - Australian Government
- Malabar Cements Ltd - India
- Vizag Seaport Private Limited - India
- GMR Energy Limited - India
- Commonwealth Bank - Australia
- Siam City Cement PLC, Thailand
- McConnell Dowell - Australia
- Thiess Contractors Indonesia
- Rashtriya Ispat Nigam Limited - India
- Dalmia Cement Bharat India
- Bulk Trading Sa - Switzerland
- Sinarmas Energy and Mining - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Aboitiz Power Corporation - Philippines
- Georgia Ports Authority, United States
- ICICI Bank Limited - India
- Energy Link Ltd, New Zealand
- CNBM International Corporation - China
- Ceylon Electricity Board - Sri Lanka
- Cement Manufacturers Association - India
- Borneo Indobara - Indonesia
- Thai Mozambique Logistica
- Larsen & Toubro Limited - India
- Grasim Industreis Ltd - India
- Africa Commodities Group - South Africa
- Bhatia International Limited - India
- Eastern Energy - Thailand
- Orica Australia Pty. Ltd.
- Kumho Petrochemical, South Korea
- Uttam Galva Steels Limited - India
- Planning Commission, India
- Rio Tinto Coal - Australia
- Maharashtra Electricity Regulatory Commission - India
- Bayan Resources Tbk. - Indonesia
- SMG Consultants - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Vedanta Resources Plc - India
- New Zealand Coal & Carbon
- SMC Global Power, Philippines
- Kaltim Prima Coal - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Chamber of Mines of South Africa
- Posco Energy - South Korea
- Kapuas Tunggal Persada - Indonesia
- San Jose City I Power Corp, Philippines
- Iligan Light & Power Inc, Philippines
- Miang Besar Coal Terminal - Indonesia
- IHS Mccloskey Coal Group - USA
- European Bulk Services B.V. - Netherlands
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- VISA Power Limited - India
- White Energy Company Limited
- The University of Queensland
- South Luzon Thermal Energy Corporation
- Global Coal Blending Company Limited - Australia
- Jorong Barutama Greston.PT - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Siam City Cement - Thailand
- Parry Sugars Refinery, India
- Maheswari Brothers Coal Limited - India
- Deloitte Consulting - India
- Central Java Power - Indonesia
- Riau Bara Harum - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Intertek Mineral Services - Indonesia
- Pendopo Energi Batubara - Indonesia
- Mjunction Services Limited - India
- Tata Chemicals Ltd - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Straits Asia Resources Limited - Singapore
- Power Finance Corporation Ltd., India
- Indonesian Coal Mining Association
- TeaM Sual Corporation - Philippines
- Sakthi Sugars Limited - India
- London Commodity Brokers - England
- Singapore Mercantile Exchange
- Antam Resourcindo - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Xindia Steels Limited - India
- Tamil Nadu electricity Board
- TNB Fuel Sdn Bhd - Malaysia
- Directorate Of Revenue Intelligence - India
- Electricity Generating Authority of Thailand
- Bangladesh Power Developement Board
- PetroVietnam Power Coal Import and Supply Company
- Salva Resources Pvt Ltd - India
- Coalindo Energy - Indonesia
- SN Aboitiz Power Inc, Philippines
- ASAPP Information Group - India
- Oldendorff Carriers - Singapore
- Timah Investasi Mineral - Indoneisa
- Holcim Trading Pte Ltd - Singapore
- Sarangani Energy Corporation, Philippines
- Minerals Council of Australia
- Indian Energy Exchange, India
- Indika Energy - Indonesia
- Baramulti Group, Indonesia
- Edison Trading Spa - Italy
- Krishnapatnam Port Company Ltd. - India
- Interocean Group of Companies - India
- Banpu Public Company Limited - Thailand
- India Bulls Power Limited - India
- Indian Oil Corporation Limited
- Carbofer General Trading SA - India
- Aditya Birla Group - India
- Binh Thuan Hamico - Vietnam
- Anglo American - United Kingdom
- Wilmar Investment Holdings
- Manunggal Multi Energi - Indonesia
- Global Business Power Corporation, Philippines
- Bukit Makmur.PT - Indonesia
- Central Electricity Authority - India
- Orica Mining Services - Indonesia
- Sindya Power Generating Company Private Ltd
- PTC India Limited - India
- Agrawal Coal Company - India
- Indogreen Group - Indonesia
- Formosa Plastics Group - Taiwan
- Essar Steel Hazira Ltd - India
- Heidelberg Cement - Germany
- GN Power Mariveles Coal Plant, Philippines
- MS Steel International - UAE
- Economic Council, Georgia
- Simpson Spence & Young - Indonesia
- Indo Tambangraya Megah - Indonesia
- Globalindo Alam Lestari - Indonesia
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- LBH Netherlands Bv - Netherlands
- Semirara Mining Corp, Philippines
- Ministry of Finance - Indonesia
- Price Waterhouse Coopers - Russia
- Parliament of New Zealand
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