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Friday, 08 May 20
LNG DEMAND FACED SEVERAL HEADWINDS IN THE FIRST QUARTER OF 2020 - GASLOG
 LNG demand faced several headwinds in the first quarter of 2020 including a warmer than average winter in the northern hemisphere, high inventory levels of natural gas and LNG in several of the largest end markets for LNG and the outbreak of COVID-19, the impact of which has had an uneven distribution around the world during the year to date. For example, Chinese demand was 15 million tonnes (“mt”) in the first quarter of 2020, a decrease of 5% over the first quarter of 2019, according to Poten, but apparent demand in April has increased year-on-year based on vessel tracking data, including several cargoes exported from the U.S., GasLog says in its latest financial report.
Gaslog further noted, meanwhile, demand from Northern Asia more broadly (Japan, China, South Korea and Taiwan) grew by approximately 1 mt in the first quarter or 3% year-over-year. In addition, demand from India grew by nearly 2 mt in the first quarter of 2020 (or 37%) as the country looked to take advantage of historically low gas prices, although apparent demand in April is likely to be lower year-on-year based on vessel tracking data. Finally, demand from Europe grew by over 4 mt (or 37%) as gas pricing favored coal-to-gas switching for power generation and LNG replaces indigenous gas production. In total, LNG demand was 98 mt in the first quarter of 2020, compared to 89 mt in the first quarter of 2019, or an increase of 10%.
Wood Mackenzie currently expects global LNG demand to grow 21 mt or 6% this year, slower than the 26 mt or 7% it anticipated earlier this year prior to the global outbreak of COVID-19. Nonetheless, the demand for LNG over the near-term continues to be uncertain as many LNG importing countries either continue to have in effect shelter-in-place orders which prevent the operation of businesses deemed to be “non-essential” or are in the early stages of reopening their economies. Consequently, measures of global economic activity have declined significantly from comparable periods in 2019. However, the longer-term outlook for LNG demand remains favorable with demand growth of 92 mt estimated over the 2019-2025 timeframe, or compound annual growth of approximately 4%, according to Wood Mackenzie.
According to GasLog's latest financial report, global LNG supply was approximately 98 mt in the first quarter of 2020, an increase of 10 mt over the first quarter of 2019 (or 11%), primarily due to new supply additions in the U.S. (Cameron T1 and T2, Freeport T1, T2 and T3 and Elba Island), according to estimates from Wood Mackenzie. LNG supply is estimated to grow by 22 mt this year as the third train of Cameron begins operations and recent capacity additions continue to increase production. Further ahead, approximately 97 mt of new LNG capacity is expected to begin production during 2021-2025. However, Wood Mackenzie expects the pace of new project sanctions to slow significantly in 2020 due to the uncertainties caused by the COVID-19 outbreak in long-term demand for LNG and low global energy prices, in particular crude oil prices due to oversupply following a collapse in oil demand due to the COVID-19 virus.
In the LNG shipping spot market, tri-fuel diesel electric vessel (“TFDE”) headline rates, as reported by Clarksons, averaged $57,000 per day in the first quarter of 2020, a decrease from the averages of $108,000 in the fourth quarter of 2019 and $59,500 in the first quarter of 2019. Headline spot rates for steam turbine propulsion (“Steam”) vessels averaged $40,000 per day in the first quarter of 2020, a decrease from the average of $78,000 per day in the fourth quarter of 2019 but approximately in line with the $39,000 per day observed in the first quarter of 2019. Slower than expected LNG demand growth due in part to the impact of COVID-19 (as detailed above), high global inventories of natural gas and LNG following a warmer than average winter in the Northern Hemisphere and limited opportunities for LNG arbitrage trading between Atlantic and Pacific basins impacted headline spot rates in the first quarter of 2020.
Clarksons currently assesses headline spot rates for TFDE and Steam LNG carriers at $32,500 per day and $23,000 per day, respectively. The COVID-19 outbreak has introduced significant uncertainty regarding demand for LNG, and consequently, demand for LNG shipping over the near term. The combined impact of the COVID-19 outbreak and normal seasonality may lead to greater volatility in spot rates and to lower utilization of vessels trading in the spot and short-term markets, in particular Steam vessels. In addition, global gas prices and gas price differentials remain near historic lows in the key markets of North Asia and Europe, limiting the opportunities for inter-basin arbitrage trading and likely reducing average voyage distances as well as potentially reducing global output of LNG over the near-term, particularly in the U.S., where a number of cargo deferrals and/or cancellations have been reported for this summer, said GasLog.
As of May 5, 2020, the orderbook totals 118 dedicated LNG carriers (>100,000 cbm), according to estimates from Poten, representing 22% of the on-the-water fleet. Of these, 74 vessels (or 63%) have multi-year charters. The pace of newbuild ordering has slowed significantly relative to 2018-19, with only 4 newbuildings ordered so far in 2020 and all of them ordered against multi-year contracts, an encouraging development for the future supply and demand balance of LNG carriers.
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Wednesday, 01 April 20
TRADERS SCRAMBLE TO SELL CHEAP CRUDE CARGOES AS GLUT GROWS - REUTERS
Oil traders across the globe are offering cargoes far in advance as rapidly vanishing demand drives key physical crude prices to multi-decade lows, ...
Wednesday, 01 April 20
MARKET INSIGHT - INTERMODAL
There is an old, allegedly Chinese, saying suggesting that living in “interesting” times usually refers to times of trouble. The latest ...
Tuesday, 31 March 20
FREIGHT MARKET: DRY BULKERS - SPOT MARKET 23-29 MARCH 2020
Capesize
The rebound in freight rates resumed this past week, with rates man-aging to post further gains by week’s end. The BCI is in negat ...
Tuesday, 31 March 20
DRY BULK: Q1 HAS BEEN THE WORST QUARTER NOTED FOR MORE THAN 3 YEARS NOW - ALLIED RESEARCH
At this point, the Covid-19 pandemic seems to be monopolizing all market (as well as all other) discussions across the world and any market insight ...
Tuesday, 31 March 20
CHINA TAIYUAN COAL TRANSACTION PRICE INDEX DOWN 0.43 PCT - XINHUA
China Taiyuan coal transaction price index stood at 132.17 points Monday, down 0.43 percent week on week.
The index, released by Chi ...
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- Bank of Tokyo Mitsubishi UFJ Ltd
- Latin American Coal - Colombia
- Toyota Tsusho Corporation, Japan
- White Energy Company Limited
- Romanian Commodities Exchange
- Bangladesh Power Developement Board
- Sindya Power Generating Company Private Ltd
- Billiton Holdings Pty Ltd - Australia
- Energy Development Corp, Philippines
- GMR Energy Limited - India
- Parliament of New Zealand
- Global Coal Blending Company Limited - Australia
- Barasentosa Lestari - Indonesia
- Aboitiz Power Corporation - Philippines
- Antam Resourcindo - Indonesia
- The University of Queensland
- Kaltim Prima Coal - Indonesia
- PowerSource Philippines DevCo
- Bukit Asam (Persero) Tbk - Indonesia
- Ind-Barath Power Infra Limited - India
- IEA Clean Coal Centre - UK
- McConnell Dowell - Australia
- Simpson Spence & Young - Indonesia
- Singapore Mercantile Exchange
- The State Trading Corporation of India Ltd
- AsiaOL BioFuels Corp., Philippines
- Malabar Cements Ltd - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Posco Energy - South Korea
- Port Waratah Coal Services - Australia
- Pendopo Energi Batubara - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Semirara Mining Corp, Philippines
- Eastern Coal Council - USA
- Commonwealth Bank - Australia
- Vedanta Resources Plc - India
- Wilmar Investment Holdings
- Binh Thuan Hamico - Vietnam
- SMG Consultants - Indonesia
- Coalindo Energy - Indonesia
- Straits Asia Resources Limited - Singapore
- Coastal Gujarat Power Limited - India
- Africa Commodities Group - South Africa
- VISA Power Limited - India
- Semirara Mining and Power Corporation, Philippines
- Jorong Barutama Greston.PT - Indonesia
- Chettinad Cement Corporation Ltd - India
- Australian Commodity Traders Exchange
- European Bulk Services B.V. - Netherlands
- Bhatia International Limited - India
- Gujarat Sidhee Cement - India
- Planning Commission, India
- Baramulti Group, Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- India Bulls Power Limited - India
- Mercator Lines Limited - India
- Miang Besar Coal Terminal - Indonesia
- Independent Power Producers Association of India
- Mintek Dendrill Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Sarangani Energy Corporation, Philippines
- Meralco Power Generation, Philippines
- Bahari Cakrawala Sebuku - Indonesia
- Bulk Trading Sa - Switzerland
- London Commodity Brokers - England
- LBH Netherlands Bv - Netherlands
- Globalindo Alam Lestari - Indonesia
- Indo Tambangraya Megah - Indonesia
- Parry Sugars Refinery, India
- Bukit Baiduri Energy - Indonesia
- Sakthi Sugars Limited - India
- Salva Resources Pvt Ltd - India
- Timah Investasi Mineral - Indoneisa
- Kohat Cement Company Ltd. - Pakistan
- Savvy Resources Ltd - HongKong
- CIMB Investment Bank - Malaysia
- Ceylon Electricity Board - Sri Lanka
- Offshore Bulk Terminal Pte Ltd, Singapore
- Metalloyd Limited - United Kingdom
- Goldman Sachs - Singapore
- Meenaskhi Energy Private Limited - India
- Petron Corporation, Philippines
- Economic Council, Georgia
- Ambuja Cements Ltd - India
- Indian Energy Exchange, India
- Essar Steel Hazira Ltd - India
- International Coal Ventures Pvt Ltd - India
- Australian Coal Association
- Tamil Nadu electricity Board
- Merrill Lynch Commodities Europe
- Siam City Cement PLC, Thailand
- Star Paper Mills Limited - India
- Gujarat Electricity Regulatory Commission - India
- MS Steel International - UAE
- Asmin Koalindo Tuhup - Indonesia
- The Treasury - Australian Government
- Carbofer General Trading SA - India
- Minerals Council of Australia
- Indogreen Group - Indonesia
- Trasteel International SA, Italy
- Petrochimia International Co. Ltd.- Taiwan
- SN Aboitiz Power Inc, Philippines
- Renaissance Capital - South Africa
- Neyveli Lignite Corporation Ltd, - India
- Medco Energi Mining Internasional
- Directorate Of Revenue Intelligence - India
- Anglo American - United Kingdom
- Iligan Light & Power Inc, Philippines
- OPG Power Generation Pvt Ltd - India
- Global Green Power PLC Corporation, Philippines
- Kapuas Tunggal Persada - Indonesia
- Tata Chemicals Ltd - India
- Karbindo Abesyapradhi - Indoneisa
- Kalimantan Lumbung Energi - Indonesia
- Manunggal Multi Energi - Indonesia
- Siam City Cement - Thailand
- Dalmia Cement Bharat India
- Lanco Infratech Ltd - India
- Orica Mining Services - Indonesia
- Cement Manufacturers Association - India
- Cigading International Bulk Terminal - Indonesia
- Borneo Indobara - Indonesia
- Larsen & Toubro Limited - India
- GVK Power & Infra Limited - India
- Jaiprakash Power Ventures ltd
- Ministry of Finance - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Chamber of Mines of South Africa
- New Zealand Coal & Carbon
- Mercuria Energy - Indonesia
- Electricity Authority, New Zealand
- Sojitz Corporation - Japan
- Ministry of Mines - Canada
- Eastern Energy - Thailand
- Karaikal Port Pvt Ltd - India
- Global Business Power Corporation, Philippines
- Kepco SPC Power Corporation, Philippines
- Interocean Group of Companies - India
- Standard Chartered Bank - UAE
- Wood Mackenzie - Singapore
- PetroVietnam Power Coal Import and Supply Company
- Orica Australia Pty. Ltd.
- Oldendorff Carriers - Singapore
- Indonesian Coal Mining Association
- Deloitte Consulting - India
- San Jose City I Power Corp, Philippines
- CNBM International Corporation - China
- Uttam Galva Steels Limited - India
- Power Finance Corporation Ltd., India
- Coal and Oil Company - UAE
- IHS Mccloskey Coal Group - USA
- GAC Shipping (India) Pvt Ltd
- Central Electricity Authority - India
- Aditya Birla Group - India
- Sree Jayajothi Cements Limited - India
- Videocon Industries ltd - India
- Bukit Makmur.PT - Indonesia
- SMC Global Power, Philippines
- Makarim & Taira - Indonesia
- Bharathi Cement Corporation - India
- Pipit Mutiara Jaya. PT, Indonesia
- Intertek Mineral Services - Indonesia
- Marubeni Corporation - India
- Sical Logistics Limited - India
- Krishnapatnam Port Company Ltd. - India
- Edison Trading Spa - Italy
- Banpu Public Company Limited - Thailand
- Indian Oil Corporation Limited
- Kumho Petrochemical, South Korea
- ASAPP Information Group - India
- Rashtriya Ispat Nigam Limited - India
- Vizag Seaport Private Limited - India
- Samtan Co., Ltd - South Korea
- Agrawal Coal Company - India
- Kobexindo Tractors - Indoneisa
- Electricity Generating Authority of Thailand
- Energy Link Ltd, New Zealand
- TNB Fuel Sdn Bhd - Malaysia
- Alfred C Toepfer International GmbH - Germany
- PTC India Limited - India
- Gujarat Mineral Development Corp Ltd - India
- Price Waterhouse Coopers - Russia
- Ministry of Transport, Egypt
- ICICI Bank Limited - India
- Xindia Steels Limited - India
- Georgia Ports Authority, United States
- Maheswari Brothers Coal Limited - India
- TeaM Sual Corporation - Philippines
- Altura Mining Limited, Indonesia
- Mjunction Services Limited - India
- Kartika Selabumi Mining - Indonesia
- Rio Tinto Coal - Australia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Riau Bara Harum - Indonesia
- Heidelberg Cement - Germany
- Kideco Jaya Agung - Indonesia
- Madhucon Powers Ltd - India
- Bhoruka Overseas - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Sinarmas Energy and Mining - Indonesia
- Bhushan Steel Limited - India
- Bayan Resources Tbk. - Indonesia
- Attock Cement Pakistan Limited
- Thiess Contractors Indonesia
- Formosa Plastics Group - Taiwan
- Thai Mozambique Logistica
- GN Power Mariveles Coal Plant, Philippines
- PNOC Exploration Corporation - Philippines
- Therma Luzon, Inc, Philippines
- Jindal Steel & Power Ltd - India
- Central Java Power - Indonesia
- South Luzon Thermal Energy Corporation
- Indika Energy - Indonesia
- Grasim Industreis Ltd - India
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