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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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Sunday, 26 April 20
STRONGER BUNKER PRICES FAIL TO RALLY FREIGHT MARKET - FIS
VLSFO bunker prices rebounded by $22.50 to $229/mt in the port of Singapore but failed to turn around the spot freight market.
Some ...
Saturday, 25 April 20
KOREA SOUTH-EAST POWER CO. INVITED BIDS FOR 780K - 900K MT OF 5600 NCV COAL FOR JULY TO OCTOBER 2020 LOADING
COALspot.com: South Korea’s KOREA SOUTH-EAST POWER CO., LTD. (KOEN) has issued an international tender for 780,000~900,000 Metric Tons (MT) s ...
Saturday, 25 April 20
SEAFARER MENTAL WELLBEING DURING THE COVID-19 PANDEMIC - STANDARD CLUB
KNOWLEDGE TO ELEVATE
COVID-19 has forced many parts of the world to enforce a lockdown in a bid to flatten the curve in terms of transmissions ...
Friday, 24 April 20
KOMIPO INVITED BIDS FOR 5700 NAR COAL FOR JUNE & JULY LOADING
COALspot.com: South Korea’s Korea Midland Power Co. Ltd. (KOMIPO) Has Issued An International Tender For 260,000 Metric Tons (MT) Steam Coal ...
Friday, 24 April 20
CHINA'S BENCHMARK POWER COAL PRICE REMAINS FLAT - XINHUA
China’s benchmark power coal price remained flat during the past week.
The Bohai-Rim Steam-Coal Price Index (BSPI), a gauge of ...
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- Siam City Cement - Thailand
- Bhoruka Overseas - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Madhucon Powers Ltd - India
- Binh Thuan Hamico - Vietnam
- SN Aboitiz Power Inc, Philippines
- Borneo Indobara - Indonesia
- Mjunction Services Limited - India
- Riau Bara Harum - Indonesia
- Interocean Group of Companies - India
- Billiton Holdings Pty Ltd - Australia
- MS Steel International - UAE
- Romanian Commodities Exchange
- India Bulls Power Limited - India
- Jindal Steel & Power Ltd - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Chamber of Mines of South Africa
- ASAPP Information Group - India
- LBH Netherlands Bv - Netherlands
- Attock Cement Pakistan Limited
- New Zealand Coal & Carbon
- IEA Clean Coal Centre - UK
- Ceylon Electricity Board - Sri Lanka
- Standard Chartered Bank - UAE
- Orica Mining Services - Indonesia
- Star Paper Mills Limited - India
- European Bulk Services B.V. - Netherlands
- Ind-Barath Power Infra Limited - India
- Bhushan Steel Limited - India
- GN Power Mariveles Coal Plant, Philippines
- Orica Australia Pty. Ltd.
- Planning Commission, India
- OPG Power Generation Pvt Ltd - India
- Sarangani Energy Corporation, Philippines
- Krishnapatnam Port Company Ltd. - India
- Merrill Lynch Commodities Europe
- Meenaskhi Energy Private Limited - India
- Mintek Dendrill Indonesia
- Minerals Council of Australia
- Parliament of New Zealand
- GAC Shipping (India) Pvt Ltd
- Asmin Koalindo Tuhup - Indonesia
- Baramulti Group, Indonesia
- GMR Energy Limited - India
- PTC India Limited - India
- Eastern Energy - Thailand
- Xindia Steels Limited - India
- Marubeni Corporation - India
- Essar Steel Hazira Ltd - India
- Indian Oil Corporation Limited
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Rio Tinto Coal - Australia
- International Coal Ventures Pvt Ltd - India
- Larsen & Toubro Limited - India
- The University of Queensland
- Gujarat Mineral Development Corp Ltd - India
- Carbofer General Trading SA - India
- Energy Development Corp, Philippines
- Electricity Generating Authority of Thailand
- Iligan Light & Power Inc, Philippines
- Global Business Power Corporation, Philippines
- PowerSource Philippines DevCo
- Straits Asia Resources Limited - Singapore
- Independent Power Producers Association of India
- SMC Global Power, Philippines
- Aboitiz Power Corporation - Philippines
- Karaikal Port Pvt Ltd - India
- Neyveli Lignite Corporation Ltd, - India
- Global Coal Blending Company Limited - Australia
- Goldman Sachs - Singapore
- Renaissance Capital - South Africa
- Economic Council, Georgia
- SMG Consultants - Indonesia
- Kartika Selabumi Mining - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Kobexindo Tractors - Indoneisa
- Salva Resources Pvt Ltd - India
- Bahari Cakrawala Sebuku - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Coalindo Energy - Indonesia
- Global Green Power PLC Corporation, Philippines
- Bukit Asam (Persero) Tbk - Indonesia
- Electricity Authority, New Zealand
- Kideco Jaya Agung - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Toyota Tsusho Corporation, Japan
- Georgia Ports Authority, United States
- Petron Corporation, Philippines
- Karbindo Abesyapradhi - Indoneisa
- Coal and Oil Company - UAE
- GVK Power & Infra Limited - India
- Altura Mining Limited, Indonesia
- White Energy Company Limited
- Dalmia Cement Bharat India
- Mercator Lines Limited - India
- Bulk Trading Sa - Switzerland
- Directorate General of MIneral and Coal - Indonesia
- Port Waratah Coal Services - Australia
- Therma Luzon, Inc, Philippines
- Maharashtra Electricity Regulatory Commission - India
- Holcim Trading Pte Ltd - Singapore
- Indo Tambangraya Megah - Indonesia
- Bayan Resources Tbk. - Indonesia
- Alfred C Toepfer International GmbH - Germany
- London Commodity Brokers - England
- Bukit Makmur.PT - Indonesia
- Manunggal Multi Energi - Indonesia
- Kepco SPC Power Corporation, Philippines
- Jaiprakash Power Ventures ltd
- Formosa Plastics Group - Taiwan
- Ministry of Mines - Canada
- Offshore Bulk Terminal Pte Ltd, Singapore
- Indogreen Group - Indonesia
- Medco Energi Mining Internasional
- Pipit Mutiara Jaya. PT, Indonesia
- Savvy Resources Ltd - HongKong
- Vedanta Resources Plc - India
- Australian Coal Association
- Sindya Power Generating Company Private Ltd
- TeaM Sual Corporation - Philippines
- Indika Energy - Indonesia
- VISA Power Limited - India
- CIMB Investment Bank - Malaysia
- Wilmar Investment Holdings
- Agrawal Coal Company - India
- Power Finance Corporation Ltd., India
- The Treasury - Australian Government
- PetroVietnam Power Coal Import and Supply Company
- Ministry of Transport, Egypt
- Thai Mozambique Logistica
- Simpson Spence & Young - Indonesia
- Central Java Power - Indonesia
- Tata Chemicals Ltd - India
- TNB Fuel Sdn Bhd - Malaysia
- Latin American Coal - Colombia
- Ambuja Cements Ltd - India
- Directorate Of Revenue Intelligence - India
- McConnell Dowell - Australia
- Sree Jayajothi Cements Limited - India
- Antam Resourcindo - Indonesia
- Videocon Industries ltd - India
- Energy Link Ltd, New Zealand
- Indonesian Coal Mining Association
- Thiess Contractors Indonesia
- Ministry of Finance - Indonesia
- Commonwealth Bank - Australia
- Chettinad Cement Corporation Ltd - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Tamil Nadu electricity Board
- Kapuas Tunggal Persada - Indonesia
- Eastern Coal Council - USA
- Meralco Power Generation, Philippines
- Kohat Cement Company Ltd. - Pakistan
- Lanco Infratech Ltd - India
- Miang Besar Coal Terminal - Indonesia
- Mercuria Energy - Indonesia
- Uttam Galva Steels Limited - India
- Pendopo Energi Batubara - Indonesia
- Timah Investasi Mineral - Indoneisa
- Kaltim Prima Coal - Indonesia
- Gujarat Sidhee Cement - India
- Bukit Baiduri Energy - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Parry Sugars Refinery, India
- Wood Mackenzie - Singapore
- Leighton Contractors Pty Ltd - Australia
- Sinarmas Energy and Mining - Indonesia
- Aditya Birla Group - India
- South Luzon Thermal Energy Corporation
- Jorong Barutama Greston.PT - Indonesia
- Africa Commodities Group - South Africa
- Anglo American - United Kingdom
- Globalindo Alam Lestari - Indonesia
- Bangladesh Power Developement Board
- Sojitz Corporation - Japan
- Siam City Cement PLC, Thailand
- Grasim Industreis Ltd - India
- Kumho Petrochemical, South Korea
- Semirara Mining Corp, Philippines
- Posco Energy - South Korea
- Singapore Mercantile Exchange
- IHS Mccloskey Coal Group - USA
- PNOC Exploration Corporation - Philippines
- Oldendorff Carriers - Singapore
- The State Trading Corporation of India Ltd
- Central Electricity Authority - India
- Barasentosa Lestari - Indonesia
- Sakthi Sugars Limited - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Sical Logistics Limited - India
- Edison Trading Spa - Italy
- Metalloyd Limited - United Kingdom
- Bharathi Cement Corporation - India
- San Jose City I Power Corp, Philippines
- Cigading International Bulk Terminal - Indonesia
- Samtan Co., Ltd - South Korea
- Australian Commodity Traders Exchange
- Intertek Mineral Services - Indonesia
- ICICI Bank Limited - India
- Deloitte Consulting - India
- Coastal Gujarat Power Limited - India
- Price Waterhouse Coopers - Russia
- Bhatia International Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Malabar Cements Ltd - India
- Trasteel International SA, Italy
- Vizag Seaport Private Limited - India
- Cement Manufacturers Association - India
- Maheswari Brothers Coal Limited - India
- CNBM International Corporation - China
- Makarim & Taira - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Heidelberg Cement - Germany
- Kalimantan Lumbung Energi - Indonesia
- Indian Energy Exchange, India
- Banpu Public Company Limited - Thailand
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