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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, 07 May 20
CRUDE OIL TANKER EARNINGS DROP 68% IN NINE DAYS - BIMCO
Crude oil tanker earnings have come down sharply in recent weeks with Very Large Crude Carrier (VLCC) earnings from the Middle East Gulf to China d ...
Thursday, 07 May 20
UKRAINE PRODUCES 2.5 MLN TONNES OF COAL IN APRIL - UKRINFORM
Ukraine produced 2.5 million tonnes of coal in April 2020, which is 39% less than planned, according to the Coal Miners Union of Ukraine.
...
Thursday, 07 May 20
INDIA: GOVT TO DO AWAY WITH MANDATORY WASHING OF COAL FOR THERMAL POWER UNITS - BUSINESS STANDARD
The Centre is planning to do away with the mandatory requirement of washing of coal before it is transported to thermal power stations. The Ministr ...
Thursday, 07 May 20
CIL'S SUPPLY TO POWER SECTOR FALLS IN MARCH AMID SLUMP IN COAL DEMAND - PTI
The supply of coal to the power sector by state-owned CIL registered a decline of eight per cent to 42.30 million tonne in March in the wake of slu ...
Thursday, 07 May 20
COAL PRICE REFERENCE FALL SHARPLY IN MAY 2020 DUE TO CORONAVIRUS OUTBREAK
COALspot.com: The Ministry of Energy and Mineral Resources of the Republic of Indonesia has revised down the benchmark price of Indonesian thermal ...
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- Indian Energy Exchange, India
- Central Electricity Authority - India
- Kumho Petrochemical, South Korea
- SMG Consultants - Indonesia
- Vizag Seaport Private Limited - India
- TeaM Sual Corporation - Philippines
- Planning Commission, India
- Indogreen Group - Indonesia
- MS Steel International - UAE
- ICICI Bank Limited - India
- OPG Power Generation Pvt Ltd - India
- Semirara Mining Corp, Philippines
- GAC Shipping (India) Pvt Ltd
- ASAPP Information Group - India
- Carbofer General Trading SA - India
- Mintek Dendrill Indonesia
- Coal and Oil Company - UAE
- Bukit Makmur.PT - Indonesia
- Orica Mining Services - Indonesia
- Binh Thuan Hamico - Vietnam
- GVK Power & Infra Limited - India
- Sojitz Corporation - Japan
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Manunggal Multi Energi - Indonesia
- Heidelberg Cement - Germany
- Tamil Nadu electricity Board
- Kobexindo Tractors - Indoneisa
- Romanian Commodities Exchange
- Mercuria Energy - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Attock Cement Pakistan Limited
- Price Waterhouse Coopers - Russia
- Tata Chemicals Ltd - India
- Antam Resourcindo - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Indian Oil Corporation Limited
- Sree Jayajothi Cements Limited - India
- Miang Besar Coal Terminal - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Ambuja Cements Ltd - India
- Bahari Cakrawala Sebuku - Indonesia
- Barasentosa Lestari - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Ind-Barath Power Infra Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- Trasteel International SA, Italy
- The State Trading Corporation of India Ltd
- Mercator Lines Limited - India
- Bhoruka Overseas - Indonesia
- Baramulti Group, Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Timah Investasi Mineral - Indoneisa
- Port Waratah Coal Services - Australia
- Orica Australia Pty. Ltd.
- The Treasury - Australian Government
- The University of Queensland
- Ministry of Finance - Indonesia
- Commonwealth Bank - Australia
- Global Business Power Corporation, Philippines
- Star Paper Mills Limited - India
- European Bulk Services B.V. - Netherlands
- Bulk Trading Sa - Switzerland
- White Energy Company Limited
- Standard Chartered Bank - UAE
- Maheswari Brothers Coal Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Ministry of Transport, Egypt
- VISA Power Limited - India
- Economic Council, Georgia
- Coalindo Energy - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Banpu Public Company Limited - Thailand
- Metalloyd Limited - United Kingdom
- Sinarmas Energy and Mining - Indonesia
- Simpson Spence & Young - Indonesia
- Uttam Galva Steels Limited - India
- Interocean Group of Companies - India
- Kepco SPC Power Corporation, Philippines
- Asmin Koalindo Tuhup - Indonesia
- Global Green Power PLC Corporation, Philippines
- Therma Luzon, Inc, Philippines
- Anglo American - United Kingdom
- PNOC Exploration Corporation - Philippines
- Bangladesh Power Developement Board
- IEA Clean Coal Centre - UK
- Makarim & Taira - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- CNBM International Corporation - China
- Siam City Cement - Thailand
- India Bulls Power Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Formosa Plastics Group - Taiwan
- PowerSource Philippines DevCo
- Xindia Steels Limited - India
- Independent Power Producers Association of India
- Bhushan Steel Limited - India
- Madhucon Powers Ltd - India
- Georgia Ports Authority, United States
- Kohat Cement Company Ltd. - Pakistan
- Toyota Tsusho Corporation, Japan
- New Zealand Coal & Carbon
- Goldman Sachs - Singapore
- Electricity Authority, New Zealand
- Aboitiz Power Corporation - Philippines
- Central Java Power - Indonesia
- Energy Link Ltd, New Zealand
- Australian Commodity Traders Exchange
- Straits Asia Resources Limited - Singapore
- Pendopo Energi Batubara - Indonesia
- Meenaskhi Energy Private Limited - India
- Gujarat Mineral Development Corp Ltd - India
- Meralco Power Generation, Philippines
- Ministry of Mines - Canada
- Dalmia Cement Bharat India
- Bhatia International Limited - India
- GMR Energy Limited - India
- Mjunction Services Limited - India
- Agrawal Coal Company - India
- GN Power Mariveles Coal Plant, Philippines
- Essar Steel Hazira Ltd - India
- Singapore Mercantile Exchange
- Kapuas Tunggal Persada - Indonesia
- Indo Tambangraya Megah - Indonesia
- Iligan Light & Power Inc, Philippines
- SMC Global Power, Philippines
- Sindya Power Generating Company Private Ltd
- Eastern Coal Council - USA
- Rio Tinto Coal - Australia
- Jindal Steel & Power Ltd - India
- Directorate Of Revenue Intelligence - India
- Aditya Birla Group - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Medco Energi Mining Internasional
- London Commodity Brokers - England
- Kaltim Prima Coal - Indonesia
- Thai Mozambique Logistica
- Savvy Resources Ltd - HongKong
- Wood Mackenzie - Singapore
- Electricity Generating Authority of Thailand
- LBH Netherlands Bv - Netherlands
- Samtan Co., Ltd - South Korea
- Wilmar Investment Holdings
- Kartika Selabumi Mining - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Gujarat Sidhee Cement - India
- Leighton Contractors Pty Ltd - Australia
- AsiaOL BioFuels Corp., Philippines
- Latin American Coal - Colombia
- Gujarat Electricity Regulatory Commission - India
- Intertek Mineral Services - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Jaiprakash Power Ventures ltd
- PetroVietnam Power Coal Import and Supply Company
- Globalindo Alam Lestari - Indonesia
- Bukit Baiduri Energy - Indonesia
- Posco Energy - South Korea
- Altura Mining Limited, Indonesia
- Parliament of New Zealand
- McConnell Dowell - Australia
- CIMB Investment Bank - Malaysia
- Parry Sugars Refinery, India
- Petron Corporation, Philippines
- Sarangani Energy Corporation, Philippines
- Siam City Cement PLC, Thailand
- PTC India Limited - India
- Marubeni Corporation - India
- Bharathi Cement Corporation - India
- Videocon Industries ltd - India
- Salva Resources Pvt Ltd - India
- Coastal Gujarat Power Limited - India
- SN Aboitiz Power Inc, Philippines
- Minerals Council of Australia
- Vijayanagar Sugar Pvt Ltd - India
- Power Finance Corporation Ltd., India
- Deloitte Consulting - India
- Riau Bara Harum - Indonesia
- Cement Manufacturers Association - India
- IHS Mccloskey Coal Group - USA
- Sakthi Sugars Limited - India
- Bayan Resources Tbk. - Indonesia
- Energy Development Corp, Philippines
- Ceylon Electricity Board - Sri Lanka
- Larsen & Toubro Limited - India
- Merrill Lynch Commodities Europe
- Bukit Asam (Persero) Tbk - Indonesia
- Africa Commodities Group - South Africa
- Sical Logistics Limited - India
- Chettinad Cement Corporation Ltd - India
- Kalimantan Lumbung Energi - Indonesia
- Renaissance Capital - South Africa
- International Coal Ventures Pvt Ltd - India
- South Luzon Thermal Energy Corporation
- Australian Coal Association
- Lanco Infratech Ltd - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Semirara Mining and Power Corporation, Philippines
- Billiton Holdings Pty Ltd - Australia
- Kideco Jaya Agung - Indonesia
- Chamber of Mines of South Africa
- Indika Energy - Indonesia
- Edison Trading Spa - Italy
- Offshore Bulk Terminal Pte Ltd, Singapore
- Eastern Energy - Thailand
- Indonesian Coal Mining Association
- Global Coal Blending Company Limited - Australia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Thiess Contractors Indonesia
- Grasim Industreis Ltd - India
- Oldendorff Carriers - Singapore
- Rashtriya Ispat Nigam Limited - India
- Karaikal Port Pvt Ltd - India
- Borneo Indobara - Indonesia
- Vedanta Resources Plc - India
- San Jose City I Power Corp, Philippines
- Malabar Cements Ltd - India
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