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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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Thursday, 11 June 20
JAN-MAY, INDONESIA SHIPPED 175.15 MILLION TONS OF COAL TO ITS OVERSEAS BUYERS
Indonesia's coal production for the first 5 months of this year have reached 228 million tons. January – May 2020, Indonesia shipped US$ ...
Thursday, 11 June 20
CHINA'S BENCHMARK POWER COAL PRICE EDGES UP - XINHUA
China’s benchmark power coal price rose slightly during the past week.
The Bohai-Rim Steam-Coal Price Index (BSPI), a gauge of ...
Wednesday, 10 June 20
OPEC+ CUTS EXTENSION TO ACCELERATE MARKET REBALANCING - FITCH RATINGS
Fitch Ratings-London-08 June 2020: The OPEC+ agreement to extend by one month record oil production cuts should accelerate market rebalancing, Fitc ...
Wednesday, 10 June 20
MARKET INSIGHT - INTERMODAL
In contrast to the economic projections of the past two years for the first half of 2020, the oil & gas industry and those involved in it faced ...
Wednesday, 10 June 20
CHINA TAIYUAN COAL TRANSACTION PRICE INDEX DOWN 0.19 PCT - XINHUA
China Taiyuan coal transaction price index stood at 123.71 points Monday, down 0.19 percent week on week.
The index, released by Chi ...
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- Sarangani Energy Corporation, Philippines
- Australian Commodity Traders Exchange
- European Bulk Services B.V. - Netherlands
- Kepco SPC Power Corporation, Philippines
- MS Steel International - UAE
- International Coal Ventures Pvt Ltd - India
- Oldendorff Carriers - Singapore
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- LBH Netherlands Bv - Netherlands
- Videocon Industries ltd - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Parliament of New Zealand
- Renaissance Capital - South Africa
- Manunggal Multi Energi - Indonesia
- Savvy Resources Ltd - HongKong
- Bahari Cakrawala Sebuku - Indonesia
- SMC Global Power, Philippines
- Essar Steel Hazira Ltd - India
- Indogreen Group - Indonesia
- IHS Mccloskey Coal Group - USA
- GMR Energy Limited - India
- Larsen & Toubro Limited - India
- Energy Link Ltd, New Zealand
- Orica Mining Services - Indonesia
- PNOC Exploration Corporation - Philippines
- Australian Coal Association
- Directorate General of MIneral and Coal - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Merrill Lynch Commodities Europe
- PetroVietnam Power Coal Import and Supply Company
- Formosa Plastics Group - Taiwan
- Coal and Oil Company - UAE
- Bharathi Cement Corporation - India
- Petron Corporation, Philippines
- Wilmar Investment Holdings
- Lanco Infratech Ltd - India
- McConnell Dowell - Australia
- Xindia Steels Limited - India
- ICICI Bank Limited - India
- Orica Australia Pty. Ltd.
- Thai Mozambique Logistica
- Heidelberg Cement - Germany
- Karbindo Abesyapradhi - Indoneisa
- Price Waterhouse Coopers - Russia
- Simpson Spence & Young - Indonesia
- Posco Energy - South Korea
- Makarim & Taira - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Latin American Coal - Colombia
- Ministry of Mines - Canada
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Siam City Cement - Thailand
- Samtan Co., Ltd - South Korea
- Maharashtra Electricity Regulatory Commission - India
- SN Aboitiz Power Inc, Philippines
- Neyveli Lignite Corporation Ltd, - India
- TeaM Sual Corporation - Philippines
- Marubeni Corporation - India
- Ambuja Cements Ltd - India
- Eastern Energy - Thailand
- Romanian Commodities Exchange
- Therma Luzon, Inc, Philippines
- India Bulls Power Limited - India
- Commonwealth Bank - Australia
- Central Java Power - Indonesia
- OPG Power Generation Pvt Ltd - India
- Kaltim Prima Coal - Indonesia
- San Jose City I Power Corp, Philippines
- Medco Energi Mining Internasional
- Chettinad Cement Corporation Ltd - India
- Eastern Coal Council - USA
- Alfred C Toepfer International GmbH - Germany
- Madhucon Powers Ltd - India
- Edison Trading Spa - Italy
- Pendopo Energi Batubara - Indonesia
- Deloitte Consulting - India
- GAC Shipping (India) Pvt Ltd
- Cigading International Bulk Terminal - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Indian Energy Exchange, India
- Thiess Contractors Indonesia
- Global Coal Blending Company Limited - Australia
- London Commodity Brokers - England
- The Treasury - Australian Government
- Bayan Resources Tbk. - Indonesia
- ASAPP Information Group - India
- Grasim Industreis Ltd - India
- Minerals Council of Australia
- Tamil Nadu electricity Board
- Bukit Asam (Persero) Tbk - Indonesia
- Banpu Public Company Limited - Thailand
- PTC India Limited - India
- Sical Logistics Limited - India
- Aboitiz Power Corporation - Philippines
- Straits Asia Resources Limited - Singapore
- Gujarat Mineral Development Corp Ltd - India
- Krishnapatnam Port Company Ltd. - India
- Tata Chemicals Ltd - India
- VISA Power Limited - India
- Africa Commodities Group - South Africa
- Independent Power Producers Association of India
- Kohat Cement Company Ltd. - Pakistan
- Petrochimia International Co. Ltd.- Taiwan
- Goldman Sachs - Singapore
- Semirara Mining Corp, Philippines
- Meralco Power Generation, Philippines
- Malabar Cements Ltd - India
- Indian Oil Corporation Limited
- Rashtriya Ispat Nigam Limited - India
- Sojitz Corporation - Japan
- Global Green Power PLC Corporation, Philippines
- Mercator Lines Limited - India
- Global Business Power Corporation, Philippines
- Binh Thuan Hamico - Vietnam
- Singapore Mercantile Exchange
- Kumho Petrochemical, South Korea
- Barasentosa Lestari - Indonesia
- Indo Tambangraya Megah - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Altura Mining Limited, Indonesia
- Jaiprakash Power Ventures ltd
- Chamber of Mines of South Africa
- Agrawal Coal Company - India
- Dalmia Cement Bharat India
- Port Waratah Coal Services - Australia
- Indika Energy - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Salva Resources Pvt Ltd - India
- Ind-Barath Power Infra Limited - India
- Mercuria Energy - Indonesia
- Bangladesh Power Developement Board
- Baramulti Group, Indonesia
- South Luzon Thermal Energy Corporation
- Planning Commission, India
- Antam Resourcindo - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Ceylon Electricity Board - Sri Lanka
- Wood Mackenzie - Singapore
- Coastal Gujarat Power Limited - India
- Trasteel International SA, Italy
- Sree Jayajothi Cements Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Vedanta Resources Plc - India
- Bhoruka Overseas - Indonesia
- Riau Bara Harum - Indonesia
- The University of Queensland
- Timah Investasi Mineral - Indoneisa
- Intertek Mineral Services - Indonesia
- Uttam Galva Steels Limited - India
- Central Electricity Authority - India
- Kartika Selabumi Mining - Indonesia
- Electricity Generating Authority of Thailand
- Holcim Trading Pte Ltd - Singapore
- Kobexindo Tractors - Indoneisa
- Jorong Barutama Greston.PT - Indonesia
- Kideco Jaya Agung - Indonesia
- New Zealand Coal & Carbon
- Toyota Tsusho Corporation, Japan
- Anglo American - United Kingdom
- Ministry of Finance - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Bulk Trading Sa - Switzerland
- White Energy Company Limited
- Mintek Dendrill Indonesia
- Karaikal Port Pvt Ltd - India
- Sinarmas Energy and Mining - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Electricity Authority, New Zealand
- Bank of Tokyo Mitsubishi UFJ Ltd
- Carbofer General Trading SA - India
- Power Finance Corporation Ltd., India
- Meenaskhi Energy Private Limited - India
- Sakthi Sugars Limited - India
- Siam City Cement PLC, Thailand
- SMG Consultants - Indonesia
- Georgia Ports Authority, United States
- CIMB Investment Bank - Malaysia
- Mjunction Services Limited - India
- Maheswari Brothers Coal Limited - India
- Globalindo Alam Lestari - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Directorate Of Revenue Intelligence - India
- Vijayanagar Sugar Pvt Ltd - India
- Billiton Holdings Pty Ltd - Australia
- Semirara Mining and Power Corporation, Philippines
- Aditya Birla Group - India
- CNBM International Corporation - China
- Metalloyd Limited - United Kingdom
- Sindya Power Generating Company Private Ltd
- Cement Manufacturers Association - India
- GN Power Mariveles Coal Plant, Philippines
- Interocean Group of Companies - India
- Standard Chartered Bank - UAE
- Rio Tinto Coal - Australia
- Leighton Contractors Pty Ltd - Australia
- Jindal Steel & Power Ltd - India
- Gujarat Sidhee Cement - India
- Energy Development Corp, Philippines
- IEA Clean Coal Centre - UK
- GVK Power & Infra Limited - India
- PowerSource Philippines DevCo
- Bukit Makmur.PT - Indonesia
- Vizag Seaport Private Limited - India
- Ministry of Transport, Egypt
- Iligan Light & Power Inc, Philippines
- Bukit Baiduri Energy - Indonesia
- Economic Council, Georgia
- Parry Sugars Refinery, India
- Borneo Indobara - Indonesia
- Indonesian Coal Mining Association
- Coalindo Energy - Indonesia
- The State Trading Corporation of India Ltd
- Star Paper Mills Limited - India
- Attock Cement Pakistan Limited
- Bhushan Steel Limited - India
- Bhatia International Limited - India
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