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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, 12 May 20
CAN INDONESIA'S COAL INDUSTRY SURVIVE COVID-19? : IEEFA
Pandemic Lockdown and Slumping Prices Put Extreme Pressure on Coal Miners
Executive Summary
While attention has been focused on th ...
Tuesday, 12 May 20
INDIA'S COAL PRODUCTION TO CLOCK RECORD 700 MILLION TONNES IN FY21: COAL SECRETARY - PTI
Coal Secretary Anil Jain said FY20 coal production was lower than the target of 660 million tonnes because of flooding of a key coal mine.
&nbs ...
Monday, 11 May 20
CHINA'S BENCHMARK POWER COAL PRICE DROPS SLIGHTLY - XINHUA
China’s benchmark power coal price dropped slightly during the past week.
The Bohai-Rim Steam-Coal Price Index (BSPI), a gauge ...
Monday, 11 May 20
CORONAVIRUS PUTS MORE THAN A THIRD OF SEABORNE COAL SUPPLY AT RISK - WOOD MACKENZIE
The full impact of the coronavirus outbreak on the global economy is yet unclear. However, the demand destruction is already becoming evident, with ...
Saturday, 09 May 20
ANGLO AMERICAN CONSIDERS SPINNING OFF SOUTH AFRICAN COAL OPERATIONS - REUTERS
Diversified miner Anglo American said on Thursday it prefers unbundling and listing its thermal coal operations in South Africa on the Johannesburg ...
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- Posco Energy - South Korea
- ICICI Bank Limited - India
- Price Waterhouse Coopers - Russia
- Xindia Steels Limited - India
- Merrill Lynch Commodities Europe
- TNB Fuel Sdn Bhd - Malaysia
- International Coal Ventures Pvt Ltd - India
- Meenaskhi Energy Private Limited - India
- Miang Besar Coal Terminal - Indonesia
- Simpson Spence & Young - Indonesia
- Petron Corporation, Philippines
- Riau Bara Harum - Indonesia
- Energy Link Ltd, New Zealand
- Energy Development Corp, Philippines
- McConnell Dowell - Australia
- Baramulti Group, Indonesia
- Lanco Infratech Ltd - India
- Bukit Baiduri Energy - Indonesia
- Global Coal Blending Company Limited - Australia
- Krishnapatnam Port Company Ltd. - India
- Singapore Mercantile Exchange
- Sinarmas Energy and Mining - Indonesia
- Thiess Contractors Indonesia
- Ambuja Cements Ltd - India
- Bukit Makmur.PT - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Indian Energy Exchange, India
- Sarangani Energy Corporation, Philippines
- Romanian Commodities Exchange
- Kaltim Prima Coal - Indonesia
- PetroVietnam Power Coal Import and Supply Company
- Makarim & Taira - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Sakthi Sugars Limited - India
- Siam City Cement - Thailand
- London Commodity Brokers - England
- SMC Global Power, Philippines
- Indogreen Group - Indonesia
- Parry Sugars Refinery, India
- Directorate General of MIneral and Coal - Indonesia
- Eastern Energy - Thailand
- Petrochimia International Co. Ltd.- Taiwan
- Wilmar Investment Holdings
- Cement Manufacturers Association - India
- Formosa Plastics Group - Taiwan
- Maharashtra Electricity Regulatory Commission - India
- Pendopo Energi Batubara - Indonesia
- Electricity Generating Authority of Thailand
- Ministry of Finance - Indonesia
- GMR Energy Limited - India
- Deloitte Consulting - India
- Planning Commission, India
- IHS Mccloskey Coal Group - USA
- AsiaOL BioFuels Corp., Philippines
- Bharathi Cement Corporation - India
- Grasim Industreis Ltd - India
- Ceylon Electricity Board - Sri Lanka
- Leighton Contractors Pty Ltd - Australia
- Attock Cement Pakistan Limited
- Indo Tambangraya Megah - Indonesia
- Central Java Power - Indonesia
- Ministry of Transport, Egypt
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Sical Logistics Limited - India
- Altura Mining Limited, Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Dalmia Cement Bharat India
- PTC India Limited - India
- CNBM International Corporation - China
- Latin American Coal - Colombia
- Manunggal Multi Energi - Indonesia
- CIMB Investment Bank - Malaysia
- Independent Power Producers Association of India
- SMG Consultants - Indonesia
- Ind-Barath Power Infra Limited - India
- IEA Clean Coal Centre - UK
- Iligan Light & Power Inc, Philippines
- Mercuria Energy - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- GN Power Mariveles Coal Plant, Philippines
- Savvy Resources Ltd - HongKong
- Gujarat Sidhee Cement - India
- Therma Luzon, Inc, Philippines
- Holcim Trading Pte Ltd - Singapore
- Electricity Authority, New Zealand
- Kobexindo Tractors - Indoneisa
- Intertek Mineral Services - Indonesia
- Madhucon Powers Ltd - India
- Bhoruka Overseas - Indonesia
- Commonwealth Bank - Australia
- South Luzon Thermal Energy Corporation
- Carbofer General Trading SA - India
- Wood Mackenzie - Singapore
- Gujarat Mineral Development Corp Ltd - India
- Vedanta Resources Plc - India
- Kohat Cement Company Ltd. - Pakistan
- Siam City Cement PLC, Thailand
- Cigading International Bulk Terminal - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Rio Tinto Coal - Australia
- Borneo Indobara - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Barasentosa Lestari - Indonesia
- MS Steel International - UAE
- Rashtriya Ispat Nigam Limited - India
- Agrawal Coal Company - India
- Bayan Resources Tbk. - Indonesia
- Medco Energi Mining Internasional
- Marubeni Corporation - India
- White Energy Company Limited
- Coastal Gujarat Power Limited - India
- Sojitz Corporation - Japan
- Globalindo Alam Lestari - Indonesia
- Kepco SPC Power Corporation, Philippines
- Binh Thuan Hamico - Vietnam
- Oldendorff Carriers - Singapore
- Global Green Power PLC Corporation, Philippines
- The State Trading Corporation of India Ltd
- Metalloyd Limited - United Kingdom
- Semirara Mining Corp, Philippines
- Mjunction Services Limited - India
- Mintek Dendrill Indonesia
- Edison Trading Spa - Italy
- Port Waratah Coal Services - Australia
- Indika Energy - Indonesia
- Bhushan Steel Limited - India
- Mercator Lines Limited - India
- Sree Jayajothi Cements Limited - India
- GVK Power & Infra Limited - India
- The University of Queensland
- Offshore Bulk Terminal Pte Ltd, Singapore
- PNOC Exploration Corporation - Philippines
- Banpu Public Company Limited - Thailand
- Maheswari Brothers Coal Limited - India
- Kumho Petrochemical, South Korea
- Georgia Ports Authority, United States
- Standard Chartered Bank - UAE
- Semirara Mining and Power Corporation, Philippines
- San Jose City I Power Corp, Philippines
- Bangladesh Power Developement Board
- Karaikal Port Pvt Ltd - India
- Kideco Jaya Agung - Indonesia
- New Zealand Coal & Carbon
- Thai Mozambique Logistica
- Indonesian Coal Mining Association
- GAC Shipping (India) Pvt Ltd
- ASAPP Information Group - India
- LBH Netherlands Bv - Netherlands
- Bulk Trading Sa - Switzerland
- Orica Australia Pty. Ltd.
- Coalindo Energy - Indonesia
- Aboitiz Power Corporation - Philippines
- SN Aboitiz Power Inc, Philippines
- Power Finance Corporation Ltd., India
- Star Paper Mills Limited - India
- Global Business Power Corporation, Philippines
- Straits Asia Resources Limited - Singapore
- Eastern Coal Council - USA
- Economic Council, Georgia
- Toyota Tsusho Corporation, Japan
- Uttam Galva Steels Limited - India
- Larsen & Toubro Limited - India
- Malabar Cements Ltd - India
- European Bulk Services B.V. - Netherlands
- Billiton Holdings Pty Ltd - Australia
- Asmin Koalindo Tuhup - Indonesia
- Australian Coal Association
- The Treasury - Australian Government
- Kapuas Tunggal Persada - Indonesia
- Africa Commodities Group - South Africa
- Meralco Power Generation, Philippines
- Tata Chemicals Ltd - India
- Videocon Industries ltd - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Bhatia International Limited - India
- Coal and Oil Company - UAE
- Salva Resources Pvt Ltd - India
- Pipit Mutiara Jaya. PT, Indonesia
- Vizag Seaport Private Limited - India
- Timah Investasi Mineral - Indoneisa
- Aditya Birla Group - India
- Interocean Group of Companies - India
- Kartika Selabumi Mining - Indonesia
- Antam Resourcindo - Indonesia
- VISA Power Limited - India
- OPG Power Generation Pvt Ltd - India
- PowerSource Philippines DevCo
- Minerals Council of Australia
- Directorate Of Revenue Intelligence - India
- Bahari Cakrawala Sebuku - Indonesia
- TeaM Sual Corporation - Philippines
- Bukit Asam (Persero) Tbk - Indonesia
- Heidelberg Cement - Germany
- Jindal Steel & Power Ltd - India
- Ministry of Mines - Canada
- India Bulls Power Limited - India
- Chamber of Mines of South Africa
- Sindya Power Generating Company Private Ltd
- Australian Commodity Traders Exchange
- Gujarat Electricity Regulatory Commission - India
- Samtan Co., Ltd - South Korea
- Anglo American - United Kingdom
- Essar Steel Hazira Ltd - India
- Parliament of New Zealand
- Trasteel International SA, Italy
- Renaissance Capital - South Africa
- Kalimantan Lumbung Energi - Indonesia
- Tamil Nadu electricity Board
- Orica Mining Services - Indonesia
- Goldman Sachs - Singapore
- Indian Oil Corporation Limited
- Central Electricity Authority - India
- Karbindo Abesyapradhi - Indoneisa
- Jaiprakash Power Ventures ltd
- Chettinad Cement Corporation Ltd - India
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