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Thursday, 14 May 20
OPEC REVISES DOWN GLOBAL OIL DEMAND FORECAST AGAIN
 Crude Oil Price Movements
Crude oil prices recorded a second sharp monthly drop in April, amid an increasing oil surplus in the spot market. The OPEC Reference Basket (ORB) value plummeted by $16.26, or 48.0%, m-o-m, to $17.66/b, the lowest monthly level since December 2001. With regard to crude futures, ICE Brent declined by $7.10, or 21%, to average $26.63/b, while NYMEX WTI fell by $13.75, or 45.2%, to average $16.70/b. The contango structure of the forward curves of all crude futures benchmarks steepened further, on further worsening of global oil market fundamentals and a rapid increase in global oil inventories. Money managers firmly raised their combined futures and options net long positions in April in both ICE Brent and NYMEX WTI contracts.
World Economy
The world economy is forecast to face a recession in 2020, declining by 3.4%, following global economic growth of 2.9% in the previous year. Within the OECD, the US is forecast to contract by 5.2% 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 8.0% in 2020, compared to growth of 1.2% in 2019. Japan is forecast to contract by 5.1% in 2020, comparing to growth of 0.7% in 2019. China’s 2020 GDP is forecast to grow by 1.3%, recovering from a sharp contraction in 1Q20, and following growth of 6.1% in 2019. India is forecast to decline by 0.2%, a sharp slowdown from already weakening growth of 5.3% in 2019. Brazil’s economy is forecast to contract by 6.0% in 2020, following growth of 1.1% in 2019. Russia’s economy is forecast to contract by 4.5% in 2020, after growth of 1.3% in 2019, not only due to COVID-19, but also because of the considerable decline in oil prices.
World Oil Demand
For 2019, world oil demand growth is kept broadly unchanged compared to last month’s assessment, estimated to have grown by 0.83 mb/d, y-o-y, to average 98.72 mb/d. In 2020, world oil demand growth is adjusted lower by 2.23 mb/d and is now forecast to drop by 9.07 mb/d. However, the worst contraction in major oil demand centers around the world is expected to take place in the 2Q20, mostly in OECD Americas and Europe, with transportation and industrial fuels affected the most. As such, OECD oil demand is now revised lower by 1.20 mb/d while non-OECD oil demand growth was adjusted down by 1.03 mb/d, for total oil demand to reach 90.59 mb/d. Indeed, demand contraction in 2020 can be mitigated with sooner than expected easing of government COVID-19 related measures, and faster response of economic growth to the implemented extraordinary stimulus packages.
World Oil Supply
The non-OPEC oil supply growth estimate in 2019 is now revised up slightly by 0.04 mb/d from the previous month’s assessment, due to an upward revision in Australia’s production data, and is estimated to have grown by 2.02 mb/d. For 2020, non-OPEC oil supply is revised down further by almost 2.0 mb/d from the previous projection, and is now forecast to decline by 3.5 mb/d. The main revisions of the month are based on production shut-ins or curtailment plans announced by oil companies – including the majors – particularly in North America. Globally, not including the countries participating in the Declaration of Cooperation (DoC) and as of 6 May 2020, around 3.6 mb/d of production cuts have been announced, so far, in response to the lack of demand, low oil prices, excess supply and limited storage capacity. The 2020 oil supply growth forecast for the US is revised down by 1.3 mb/d to now show a decline of 1.4 mb/d y-o-y. Other large downward revisions are undertaken for Canada and Brazil by 0.3 mb/d and 0.1 mb/d, respectively. Oil supply in 2020 is 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 is forecast to grow by 0.04 mb/d to average 4.83 mb/d. In April, OPEC crude oil production increased by 1.80 mb/d m-o-m to average 30.41 mb/d, according to secondary sources
Product Markets and Refining
Operations Refinery margins in the Atlantic Basin rebounded in April. Deeper refinery intake cuts as well as low feedstock prices helped offset weak demand. In addition, the relaxation of confinement measures in the US and Europe amid the onset of the driving season, provided much-needed stimulus to the top of the barrel. In Asia, however, stronger product availability, as refineries increased processing rates, outpaced product inventory drawdowns amid a lack of demand from overseas, weighed on the regional product market.
Tanker Market
April was a stellar month for the tanker market with both dirty and clean rates seeing spikes during the month. Dirty freight rates peaked early in April and then trended lower, although remaining at relatively high levels. Rates were supported by a surge in tanker demand, driven by low crude prices and a need to push out excess supplies amid concerns about the availability of onshore storage capacity. Meanwhile, clean tanker rates jumped to historic highs in the middle of April, as refiners and traders looked to boosting product exports and turned to floating storage. However, rates returned to more typical levels by the end of the month. The expected voluntary and involuntary production reductions are expected to weigh on tanker demand in the coming months, although increased floating storage will provided offsetting support.
Crude and Refined Products Trade
According to preliminary data, US crude imports in April fell to 5.4 mb/d – the lowest since 1992 – while the country’s crude exports averaged 3.2 mb/d, down from a peak of 3.7 mb/d in February 2020. In March, China’s crude imports averaged 9.7 mb/d, falling below 10 mb/d for the first time in eight months. Product exports from China surged to 1.85 mb/d, the second highest level on record, led by a jump in diesel exports. India’s crude imports dipped in March to average 4.6 mb/d, impacted by the government-ordered lockdown which began toward the end of the month. India’s product exports rose 10% m-o-m, supported by an increase in diesel exports. Crude imports into Japan increased for the first time in two months, averaging 3.1 mb/d in March, while product imports and exports were slightly lower. The latest official data for OECD Europe shows crude exports continuing to fall in January, reaching 2.2 mb/d.
Commercial Stock Movements
OECD commercial oil stocks rose by 57.7 mb m-o-m in March to stand at 3,002 mb. This was 125.8 mb higher than the same time one year ago and 88.6 mb above the latest five-year average. Within components, crude stocks surged by 49.1 mb, while product stocks rose by 8.6 mb, m-o-m. In terms of days of forward cover, OECD commercial stocks surged by 8.9 days m-o-m in March to stand at 86.1 days. This was 25.1 days above March 2019, and 23.8 days above the latest five-year average. Preliminary data for April showed that US total commercial oil stocks surged by 81.1 mb m-o-m to stand at 1,395 mb. This was 136.1 mb, or 10.8%, above the same period a year ago, and 123.7 mb, or 9.7%, higher than the latest five-year average. Within components, crude stocks climbed by 47.9 mb, and product stocks rose by 33.2 mb m-o-m in April. Balance of
Supply and Demand
Demand for OPEC crude in 2019 stood at 29.8 mb/d, 1.2 mb/d lower than the 2018 level. For 2020, and following the recent agreement reached at the extraordinary OPEC and non-OPEC Ministerial Meetings in April, demand for OPEC crude is expected at 24.3 mb/d, which is 5.6 mb/d lower than the 2019 level. It is worth noting that demand for OPEC crude in 2020 remained almost the same as last month’s assessment, both considering the voluntary adjustment volumes under the Declaration of Cooperation (DoC) framework. However, additional reductions recently announced by several OPEC member countries, above and beyond their voluntary commitments under DoC, are expected to expedite market re-balancing, and improve the demand for OPEC crude in 2020.
Source: OPEC
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Tuesday, 09 June 20
BUNKER SUPPLY CONTRACTS - KEY CONSIDERATIONS FOR THE BUYER - GARD
KNOWLEDGE TO ELEVATE
Regardless of whether a buyer purchases fuel directly from physical suppliers or via brokers or traders and whether sale ...
Tuesday, 09 June 20
INDIA: COAL IMPORT DROPS BY 20% TO NEARLY 19 MILLION TONNES IN MAY, SAYS REPORT - HINDUSTAN TIMES
The country’s coal import dropped by 20 per cent to 18.93 million tonnes (MT) last month, industry data showed.
The government ...
Monday, 08 June 20
WOOD MACKENZIE: THE INDISPENSABLE OPEC+
Rumours of “the death of OPEC” have been circulating for almost as long as the organisation has existed. Just three years after the car ...
Monday, 08 June 20
CHINA'S COAL IMPORTS FALL NEARLY 20% IN MAY EVEN AS DEMAND RISES - REUTERS
China’s coal imports in May fell nearly 20% compared with a year earlier even as demand recovered at power plants and industrial users, custo ...
Monday, 08 June 20
JUNE 2020 INDONESIAN COAL PRICE REFERENCE HIT US$ 52.98 A TON, ITS LOWEST LEVEL SINCE AT LEAST AUGUST 2016
COALspot.com: The Ministry of Energy and Mineral Resources of the Republic of Indonesia has revised down again the benchmark price of Indonesian th ...
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- Chamber of Mines of South Africa
- Alfred C Toepfer International GmbH - Germany
- Edison Trading Spa - Italy
- Kideco Jaya Agung - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Iligan Light & Power Inc, Philippines
- Bhatia International Limited - India
- Siam City Cement - Thailand
- Maheswari Brothers Coal Limited - India
- Bangladesh Power Developement Board
- GVK Power & Infra Limited - India
- Aboitiz Power Corporation - Philippines
- Kaltim Prima Coal - Indonesia
- Oldendorff Carriers - Singapore
- LBH Netherlands Bv - Netherlands
- Sarangani Energy Corporation, Philippines
- Star Paper Mills Limited - India
- Mercator Lines Limited - India
- Karbindo Abesyapradhi - Indoneisa
- Ministry of Finance - Indonesia
- Riau Bara Harum - Indonesia
- Standard Chartered Bank - UAE
- Manunggal Multi Energi - Indonesia
- CNBM International Corporation - China
- Essar Steel Hazira Ltd - India
- Samtan Co., Ltd - South Korea
- Chettinad Cement Corporation Ltd - India
- Sojitz Corporation - Japan
- Straits Asia Resources Limited - Singapore
- Pipit Mutiara Jaya. PT, Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Larsen & Toubro Limited - India
- White Energy Company Limited
- Maharashtra Electricity Regulatory Commission - India
- Merrill Lynch Commodities Europe
- Cement Manufacturers Association - India
- Jindal Steel & Power Ltd - India
- Renaissance Capital - South Africa
- Kapuas Tunggal Persada - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Tamil Nadu electricity Board
- The State Trading Corporation of India Ltd
- Krishnapatnam Port Company Ltd. - India
- Kartika Selabumi Mining - Indonesia
- MS Steel International - UAE
- Energy Development Corp, Philippines
- Sinarmas Energy and Mining - Indonesia
- Mjunction Services Limited - India
- Xindia Steels Limited - India
- Kumho Petrochemical, South Korea
- Ministry of Transport, Egypt
- Neyveli Lignite Corporation Ltd, - India
- Timah Investasi Mineral - Indoneisa
- Orica Australia Pty. Ltd.
- Bharathi Cement Corporation - India
- Ceylon Electricity Board - Sri Lanka
- Uttam Galva Steels Limited - India
- CIMB Investment Bank - Malaysia
- Georgia Ports Authority, United States
- Orica Mining Services - Indonesia
- Mercuria Energy - Indonesia
- Price Waterhouse Coopers - Russia
- Siam City Cement PLC, Thailand
- PTC India Limited - India
- Singapore Mercantile Exchange
- Sical Logistics Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Directorate Of Revenue Intelligence - India
- Metalloyd Limited - United Kingdom
- Semirara Mining and Power Corporation, Philippines
- Global Coal Blending Company Limited - Australia
- IHS Mccloskey Coal Group - USA
- Savvy Resources Ltd - HongKong
- Petron Corporation, Philippines
- Meenaskhi Energy Private Limited - India
- Vedanta Resources Plc - India
- GN Power Mariveles Coal Plant, Philippines
- Ind-Barath Power Infra Limited - India
- Global Green Power PLC Corporation, Philippines
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Simpson Spence & Young - Indonesia
- Malabar Cements Ltd - India
- Sakthi Sugars Limited - India
- Wood Mackenzie - Singapore
- Port Waratah Coal Services - Australia
- Romanian Commodities Exchange
- Globalindo Alam Lestari - Indonesia
- New Zealand Coal & Carbon
- Thai Mozambique Logistica
- Minerals Council of Australia
- Gujarat Sidhee Cement - India
- London Commodity Brokers - England
- Bhushan Steel Limited - India
- Carbofer General Trading SA - India
- Agrawal Coal Company - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Bukit Baiduri Energy - Indonesia
- Power Finance Corporation Ltd., India
- Energy Link Ltd, New Zealand
- AsiaOL BioFuels Corp., Philippines
- Ambuja Cements Ltd - India
- Borneo Indobara - Indonesia
- Intertek Mineral Services - Indonesia
- Barasentosa Lestari - Indonesia
- Anglo American - United Kingdom
- Marubeni Corporation - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Global Business Power Corporation, Philippines
- TeaM Sual Corporation - Philippines
- PetroVietnam Power Coal Import and Supply Company
- Madhucon Powers Ltd - India
- Parry Sugars Refinery, India
- TNB Fuel Sdn Bhd - Malaysia
- Therma Luzon, Inc, Philippines
- Makarim & Taira - Indonesia
- Central Java Power - Indonesia
- Vizag Seaport Private Limited - India
- Economic Council, Georgia
- Bhoruka Overseas - Indonesia
- Billiton Holdings Pty Ltd - Australia
- ASAPP Information Group - India
- Goldman Sachs - Singapore
- PNOC Exploration Corporation - Philippines
- Semirara Mining Corp, Philippines
- Bulk Trading Sa - Switzerland
- Bayan Resources Tbk. - Indonesia
- McConnell Dowell - Australia
- Petrochimia International Co. Ltd.- Taiwan
- Eastern Coal Council - USA
- Thiess Contractors Indonesia
- Africa Commodities Group - South Africa
- Banpu Public Company Limited - Thailand
- Rashtriya Ispat Nigam Limited - India
- Sindya Power Generating Company Private Ltd
- Indian Oil Corporation Limited
- Bukit Makmur.PT - Indonesia
- Dalmia Cement Bharat India
- Kepco SPC Power Corporation, Philippines
- International Coal Ventures Pvt Ltd - India
- Tata Chemicals Ltd - India
- Coastal Gujarat Power Limited - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- VISA Power Limited - India
- Toyota Tsusho Corporation, Japan
- The University of Queensland
- Indian Energy Exchange, India
- The Treasury - Australian Government
- PowerSource Philippines DevCo
- Gujarat Electricity Regulatory Commission - India
- Medco Energi Mining Internasional
- Heidelberg Cement - Germany
- South Luzon Thermal Energy Corporation
- Indika Energy - Indonesia
- Australian Commodity Traders Exchange
- Cigading International Bulk Terminal - Indonesia
- ICICI Bank Limited - India
- Kalimantan Lumbung Energi - Indonesia
- India Bulls Power Limited - India
- Karaikal Port Pvt Ltd - India
- Latin American Coal - Colombia
- SMC Global Power, Philippines
- Deloitte Consulting - India
- GAC Shipping (India) Pvt Ltd
- Kobexindo Tractors - Indoneisa
- Planning Commission, India
- Parliament of New Zealand
- Asmin Koalindo Tuhup - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Jorong Barutama Greston.PT - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Holcim Trading Pte Ltd - Singapore
- Electricity Generating Authority of Thailand
- Salva Resources Pvt Ltd - India
- European Bulk Services B.V. - Netherlands
- Baramulti Group, Indonesia
- SN Aboitiz Power Inc, Philippines
- Indonesian Coal Mining Association
- Meralco Power Generation, Philippines
- Aditya Birla Group - India
- Attock Cement Pakistan Limited
- Indo Tambangraya Megah - Indonesia
- Electricity Authority, New Zealand
- Sree Jayajothi Cements Limited - India
- Posco Energy - South Korea
- SMG Consultants - Indonesia
- Formosa Plastics Group - Taiwan
- Commonwealth Bank - Australia
- Pendopo Energi Batubara - Indonesia
- Interocean Group of Companies - India
- Rio Tinto Coal - Australia
- Australian Coal Association
- GMR Energy Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Lanco Infratech Ltd - India
- OPG Power Generation Pvt Ltd - India
- Coalindo Energy - Indonesia
- Central Electricity Authority - India
- Wilmar Investment Holdings
- Trasteel International SA, Italy
- Grasim Industreis Ltd - India
- Coal and Oil Company - UAE
- San Jose City I Power Corp, Philippines
- Leighton Contractors Pty Ltd - Australia
- Binh Thuan Hamico - Vietnam
- Videocon Industries ltd - India
- Eastern Energy - Thailand
- Mintek Dendrill Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Independent Power Producers Association of India
- Antam Resourcindo - Indonesia
- Ministry of Mines - Canada
- Miang Besar Coal Terminal - Indonesia
- Jaiprakash Power Ventures ltd
- IEA Clean Coal Centre - UK
- Altura Mining Limited, Indonesia
- Indogreen Group - Indonesia
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