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Wednesday, 29 April 20
OIL CLOSES IN ON PEAK OVERSUPPLY - WOOD MACKENZIE
Are we now deep in the abyss? Up to our necks in it, if the oil price is any guide. Brent has now tested sub-US$20/bbl in this downturn and WTI sub-zero, albeit briefly and in somewhat freakish circumstances. Where are the signs of stress across the oil value chain? And what are the prospects of finding an exit route to recovery? I talked it through with Ann-Louise Hittle of our Macro Oils team.
First, oil demand, which we think may be close to bottoming out. Decline has been sharp and deep as Covid-19 takes its toll on global economic activity. Much of the world is currently in lockdown, with more than 65% of the world’s population under travel restrictions. Global air travel and car use have nosedived in many countries. The big hit has been on jet fuel demand (down 50% year-on-year) and gasoline (down 25%). Diesel and fuel oil – used to transport goods by truck, ship and rail – have held relatively steady.
The net effect will be April’s demand falling by an average of 15 million to 18 million b/d year on year, based on the early April forecast from our Macro Oils Service. It’s a big number but may be bigger still on certain days or weeks in April and May. Some estimates have suggested declines of 20 million b/d or more.
A key question is when the global economic recovery that’s needed to kick start oil demand growth again will begin. Right now, we appear to be in limbo. India, France and the UK, among other big economies, have extended lockdowns into May. Italy, Spain, Austria and others have started to ease restrictions while several US states are considering re-opening in May. There are early signs of US gasoline demand stabilising.
China though is the model to watch as it emerges from lockdown. It has already started ratcheting up crude purchases in April to supply a reviving economy.
Second, inventory is building at superfast rates globally. Cushing, Oklahoma, is a microcosm of the wider picture. Oil prices in Texas have incentivised producers to send crude to the Cushing hub; weak demand from refineries in the Mid-West and Gulf Coast have kept it there. Storage tanks are filling up rapidly – the three largest weekly builds on record were in consecutive weeks from late March, based on Genscape’s proprietary twice-weekly tank monitoring.
Cushing’s tightening storage capacity played a central role in WTI’s ignominious dive into negative prices on 20 April, ahead of the May contract expiry. Traders and financial players were effectively ambushed – having to pay counterparties up to US$37/bbl to roll out of their expiring May contracts and into June.
Storage globally will stay tight so long as oversupply persists. Genscape estimates Cushing‘s spare capacity of up to 15 million b/d will be full within weeks, and other landlocked hubs – the Caspian for one – are in a similar position. But in reality, producers everywhere are worried their crude won’t be able to find a home.
Third, the world is still awash with supply, which unlike demand is still close to pre-crisis levels. Low prices have killed off new investment but have not yet had much impact on production. So far, we estimate barely one million b/d of onstream non-OPEC production has been shut in.
These are sizeable volumes but, given the scale of the market oversupply, insignificant. We estimate over 15 million b/d of production generates negative operating cash flow, now that prices have lurched lower. As storage fills up, more wells and fields will be shut-in during the coming weeks. Curtailed volumes will quickly mount up.
What must happen for the oil market to start rebalancing and prices to recover? May is important for supply, with OPEC+ cuts taking effect and removing up to 7 million b/d from the market by the end of the month. We expect a slow return to “normal” life in H2 2020 to help demand recover, though most likely staying below pre-crisis levels.
A strong bounce in demand as the world emerges from recession will be needed to soak up the overhang of inventory, which threatens to reach record levels by summer. Nothing, however, can be taken for granted while coronavirus still poses a threat to economic – and social – activity.
Source: Wood Mackenzie
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Wednesday, 26 February 20
AS ALL OF THE GLOBAL COAL GIANTS EXIT SOUTH AFRICA, ESKOM TO DEPEND ON TWO MINERS FOR 70% OF ITS SUPPLY - BUSINESS INSIDER
While some of its politicians continue to imagine that coal has a future in South Africa, two key developments from the real world show that securi ...
Tuesday, 25 February 20
DELTA DUNIA MAKMUR REGISTERED A NET PROFIT OF US$20 MILLION FOR FY 2019
PT Delta Dunia Makmur, one of the largest coal mining company in Indonesia, has recorded an US$882 million revenue for FY 2019, 1% lower compared t ...
Tuesday, 25 February 20
SHIPPING UPDATE - ALLIED
The positive feeling and optimism for a fresh rally during the first few months of 2020 that prevailed in the tanker markets during the final quart ...
Monday, 24 February 20
COULD SOME VLSFO FUELS BE BANNED? - GIBSON
The run up to the implementation of the new IMO rules on marine fuels from1st January 2020 had owners and charterers analysing the vari ...
Monday, 24 February 20
CHINA SAYS MAJOR COAL FIRMS RESTORE 95% OF PRODUCTION CAPACITY - REUTERS
China’s coal companies controlled by the central government have resumed operations and are back at more than 95% of their capacity, an offic ...
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Showing 1106 to 1110 news of total 6871 |
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- Malabar Cements Ltd - India
- Baramulti Group, Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Sinarmas Energy and Mining - Indonesia
- Oldendorff Carriers - Singapore
- Kalimantan Lumbung Energi - Indonesia
- Bukit Baiduri Energy - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Posco Energy - South Korea
- Gujarat Sidhee Cement - India
- Leighton Contractors Pty Ltd - Australia
- Bukit Asam (Persero) Tbk - Indonesia
- Ministry of Mines - Canada
- Price Waterhouse Coopers - Russia
- Electricity Authority, New Zealand
- Coal and Oil Company - UAE
- Petrochimia International Co. Ltd.- Taiwan
- Sindya Power Generating Company Private Ltd
- Bhoruka Overseas - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- TeaM Sual Corporation - Philippines
- Banpu Public Company Limited - Thailand
- Heidelberg Cement - Germany
- Edison Trading Spa - Italy
- Indo Tambangraya Megah - Indonesia
- Georgia Ports Authority, United States
- Simpson Spence & Young - Indonesia
- Salva Resources Pvt Ltd - India
- Anglo American - United Kingdom
- Intertek Mineral Services - Indonesia
- Australian Coal Association
- Riau Bara Harum - Indonesia
- London Commodity Brokers - England
- Goldman Sachs - Singapore
- Agrawal Coal Company - India
- Toyota Tsusho Corporation, Japan
- Kideco Jaya Agung - Indonesia
- Bhatia International Limited - India
- Miang Besar Coal Terminal - Indonesia
- International Coal Ventures Pvt Ltd - India
- Siam City Cement PLC, Thailand
- Iligan Light & Power Inc, Philippines
- Kepco SPC Power Corporation, Philippines
- Independent Power Producers Association of India
- PetroVietnam Power Coal Import and Supply Company
- Siam City Cement - Thailand
- Grasim Industreis Ltd - India
- Commonwealth Bank - Australia
- Star Paper Mills Limited - India
- Thiess Contractors Indonesia
- Pendopo Energi Batubara - Indonesia
- Chettinad Cement Corporation Ltd - India
- Makarim & Taira - Indonesia
- European Bulk Services B.V. - Netherlands
- Singapore Mercantile Exchange
- Directorate Of Revenue Intelligence - India
- Bayan Resources Tbk. - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Romanian Commodities Exchange
- Kohat Cement Company Ltd. - Pakistan
- Power Finance Corporation Ltd., India
- Ceylon Electricity Board - Sri Lanka
- Asmin Koalindo Tuhup - Indonesia
- Ministry of Finance - Indonesia
- Semirara Mining Corp, Philippines
- Kobexindo Tractors - Indoneisa
- Lanco Infratech Ltd - India
- Dalmia Cement Bharat India
- SN Aboitiz Power Inc, Philippines
- Essar Steel Hazira Ltd - India
- Videocon Industries ltd - India
- Coalindo Energy - Indonesia
- Marubeni Corporation - India
- GAC Shipping (India) Pvt Ltd
- Bank of Tokyo Mitsubishi UFJ Ltd
- Barasentosa Lestari - Indonesia
- Binh Thuan Hamico - Vietnam
- Orica Mining Services - Indonesia
- The University of Queensland
- Mjunction Services Limited - India
- GVK Power & Infra Limited - India
- CIMB Investment Bank - Malaysia
- Mercator Lines Limited - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- OPG Power Generation Pvt Ltd - India
- Ministry of Transport, Egypt
- Australian Commodity Traders Exchange
- VISA Power Limited - India
- Bangladesh Power Developement Board
- Kaltim Prima Coal - Indonesia
- Altura Mining Limited, Indonesia
- Karaikal Port Pvt Ltd - India
- San Jose City I Power Corp, Philippines
- Ambuja Cements Ltd - India
- South Luzon Thermal Energy Corporation
- Maheswari Brothers Coal Limited - India
- Petron Corporation, Philippines
- Thai Mozambique Logistica
- Renaissance Capital - South Africa
- Uttam Galva Steels Limited - India
- Antam Resourcindo - Indonesia
- CNBM International Corporation - China
- Bahari Cakrawala Sebuku - Indonesia
- Attock Cement Pakistan Limited
- Tata Chemicals Ltd - India
- AsiaOL BioFuels Corp., Philippines
- Straits Asia Resources Limited - Singapore
- Energy Link Ltd, New Zealand
- Aboitiz Power Corporation - Philippines
- Sree Jayajothi Cements Limited - India
- India Bulls Power Limited - India
- Jaiprakash Power Ventures ltd
- Mercuria Energy - Indonesia
- Larsen & Toubro Limited - India
- Indika Energy - Indonesia
- Latin American Coal - Colombia
- Samtan Co., Ltd - South Korea
- Interocean Group of Companies - India
- Alfred C Toepfer International GmbH - Germany
- Standard Chartered Bank - UAE
- Gujarat Mineral Development Corp Ltd - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Rio Tinto Coal - Australia
- Chamber of Mines of South Africa
- Global Green Power PLC Corporation, Philippines
- Merrill Lynch Commodities Europe
- Madhucon Powers Ltd - India
- Trasteel International SA, Italy
- Kumho Petrochemical, South Korea
- Semirara Mining and Power Corporation, Philippines
- PTC India Limited - India
- Xindia Steels Limited - India
- Savvy Resources Ltd - HongKong
- Bukit Makmur.PT - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Energy Development Corp, Philippines
- Parliament of New Zealand
- Indogreen Group - Indonesia
- Meenaskhi Energy Private Limited - India
- Wood Mackenzie - Singapore
- Minerals Council of Australia
- Bharathi Cement Corporation - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Gujarat Electricity Regulatory Commission - India
- Vijayanagar Sugar Pvt Ltd - India
- Eastern Energy - Thailand
- Deloitte Consulting - India
- Orica Australia Pty. Ltd.
- Economic Council, Georgia
- Eastern Coal Council - USA
- Kapuas Tunggal Persada - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- McConnell Dowell - Australia
- Vedanta Resources Plc - India
- Pipit Mutiara Jaya. PT, Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Kartika Selabumi Mining - Indonesia
- The State Trading Corporation of India Ltd
- The Treasury - Australian Government
- LBH Netherlands Bv - Netherlands
- Metalloyd Limited - United Kingdom
- Medco Energi Mining Internasional
- Manunggal Multi Energi - Indonesia
- Tamil Nadu electricity Board
- Mintek Dendrill Indonesia
- SMC Global Power, Philippines
- Global Business Power Corporation, Philippines
- New Zealand Coal & Carbon
- Central Java Power - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- GN Power Mariveles Coal Plant, Philippines
- Directorate General of MIneral and Coal - Indonesia
- Indian Oil Corporation Limited
- Rashtriya Ispat Nigam Limited - India
- Africa Commodities Group - South Africa
- Borneo Indobara - Indonesia
- Therma Luzon, Inc, Philippines
- Sojitz Corporation - Japan
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Ind-Barath Power Infra Limited - India
- GMR Energy Limited - India
- Cement Manufacturers Association - India
- Coastal Gujarat Power Limited - India
- SMG Consultants - Indonesia
- Carbofer General Trading SA - India
- Krishnapatnam Port Company Ltd. - India
- TNB Fuel Sdn Bhd - Malaysia
- Electricity Generating Authority of Thailand
- Globalindo Alam Lestari - Indonesia
- PNOC Exploration Corporation - Philippines
- Vizag Seaport Private Limited - India
- IEA Clean Coal Centre - UK
- IHS Mccloskey Coal Group - USA
- Global Coal Blending Company Limited - Australia
- Meralco Power Generation, Philippines
- Planning Commission, India
- White Energy Company Limited
- Parry Sugars Refinery, India
- Central Electricity Authority - India
- Timah Investasi Mineral - Indoneisa
- ICICI Bank Limited - India
- Wilmar Investment Holdings
- Bhushan Steel Limited - India
- Indian Energy Exchange, India
- Port Waratah Coal Services - Australia
- Jindal Steel & Power Ltd - India
- PowerSource Philippines DevCo
- Sical Logistics Limited - India
- Aditya Birla Group - India
- MS Steel International - UAE
- Indonesian Coal Mining Association
- Sarangani Energy Corporation, Philippines
- Formosa Plastics Group - Taiwan
- ASAPP Information Group - India
- Bulk Trading Sa - Switzerland
- Sakthi Sugars Limited - India
- Cigading International Bulk Terminal - Indonesia
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