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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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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, rec ...
Friday, 17 April 20
SAUDI ARABIA'S MAY 2020 OSPS FOR CRUDE EXPORTS BODE WELL FOR ASIAN REFINERS - WOOD MACKENZIE
On 13 April, Saudi Arabia announced the Official Selling Prices (OSPs) for its May crude oil exports. The new OSPs speak volumes about Saudi Arabia ...
Friday, 17 April 20
SEABORNE COAL PRICES UNDER PRESSURE AS DEMAND SOFTENS IN CHINA, INDIA - CLYDE RUSSELL
Worrying signs are emerging for coal exporters to the world’s biggest markets in Asia, as top buyers China and India move to favour domestic ...
Thursday, 16 April 20
THERMAL POWER SECTOR FACES BLEAK SCENARIO POST-COVID SITUATION - THE HINDU BUSINESS LINE
The centre should take a fresh look at coal-energy value chain as the sector tops the chart on loan defaults.
Covid-19 may have serv ...
Thursday, 16 April 20
CHINA'S BENCHMARK POWER COAL PRICE FALLS 5 YUAN PER TONNE - XINHUA
China’s benchmark power coal price fell by 5 yuan (about 70 U.S. cents) per tonne during the past week.
The Bohai-Rim Steam-Co ...
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- Bukit Asam (Persero) Tbk - Indonesia
- Medco Energi Mining Internasional
- Kartika Selabumi Mining - Indonesia
- Africa Commodities Group - South Africa
- Bukit Makmur.PT - Indonesia
- Salva Resources Pvt Ltd - India
- Minerals Council of Australia
- The University of Queensland
- Heidelberg Cement - Germany
- Anglo American - United Kingdom
- Indogreen Group - Indonesia
- Sindya Power Generating Company Private Ltd
- Bhoruka Overseas - Indonesia
- Therma Luzon, Inc, Philippines
- Electricity Generating Authority of Thailand
- Gujarat Mineral Development Corp Ltd - India
- Sree Jayajothi Cements Limited - India
- European Bulk Services B.V. - Netherlands
- Dalmia Cement Bharat India
- Ministry of Transport, Egypt
- Deloitte Consulting - India
- Wood Mackenzie - Singapore
- Asmin Koalindo Tuhup - Indonesia
- Indonesian Coal Mining Association
- Sical Logistics Limited - India
- Videocon Industries ltd - India
- Meralco Power Generation, Philippines
- Pendopo Energi Batubara - Indonesia
- IHS Mccloskey Coal Group - USA
- Directorate General of MIneral and Coal - Indonesia
- Vedanta Resources Plc - India
- Indian Energy Exchange, India
- Cigading International Bulk Terminal - Indonesia
- Binh Thuan Hamico - Vietnam
- IEA Clean Coal Centre - UK
- PNOC Exploration Corporation - Philippines
- Altura Mining Limited, Indonesia
- Orica Mining Services - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Uttam Galva Steels Limited - India
- Cement Manufacturers Association - India
- VISA Power Limited - India
- Kapuas Tunggal Persada - Indonesia
- Global Coal Blending Company Limited - Australia
- Bukit Baiduri Energy - Indonesia
- Central Electricity Authority - India
- Vijayanagar Sugar Pvt Ltd - India
- Larsen & Toubro Limited - India
- Parry Sugars Refinery, India
- Rashtriya Ispat Nigam Limited - India
- San Jose City I Power Corp, Philippines
- Parliament of New Zealand
- Gujarat Sidhee Cement - India
- Indika Energy - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Mjunction Services Limited - India
- SN Aboitiz Power Inc, Philippines
- International Coal Ventures Pvt Ltd - India
- Baramulti Group, Indonesia
- Australian Commodity Traders Exchange
- Riau Bara Harum - Indonesia
- Timah Investasi Mineral - Indoneisa
- Petrochimia International Co. Ltd.- Taiwan
- LBH Netherlands Bv - Netherlands
- Renaissance Capital - South Africa
- Goldman Sachs - Singapore
- Maharashtra Electricity Regulatory Commission - India
- SMG Consultants - Indonesia
- Power Finance Corporation Ltd., India
- Energy Link Ltd, New Zealand
- CNBM International Corporation - China
- Sojitz Corporation - Japan
- London Commodity Brokers - England
- Coastal Gujarat Power Limited - India
- Samtan Co., Ltd - South Korea
- Sakthi Sugars Limited - India
- Singapore Mercantile Exchange
- Kalimantan Lumbung Energi - Indonesia
- Petron Corporation, Philippines
- Romanian Commodities Exchange
- Karaikal Port Pvt Ltd - India
- Billiton Holdings Pty Ltd - Australia
- Kohat Cement Company Ltd. - Pakistan
- Commonwealth Bank - Australia
- Star Paper Mills Limited - India
- GVK Power & Infra Limited - India
- Semirara Mining Corp, Philippines
- SMC Global Power, Philippines
- Mintek Dendrill Indonesia
- Grasim Industreis Ltd - India
- Savvy Resources Ltd - HongKong
- Gujarat Electricity Regulatory Commission - India
- Mercator Lines Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- Chettinad Cement Corporation Ltd - India
- The Treasury - Australian Government
- Ministry of Finance - Indonesia
- Directorate Of Revenue Intelligence - India
- Ambuja Cements Ltd - India
- Australian Coal Association
- Makarim & Taira - Indonesia
- Tamil Nadu electricity Board
- Rio Tinto Coal - Australia
- Edison Trading Spa - Italy
- CIMB Investment Bank - Malaysia
- MS Steel International - UAE
- Essar Steel Hazira Ltd - India
- Holcim Trading Pte Ltd - Singapore
- Kobexindo Tractors - Indoneisa
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Formosa Plastics Group - Taiwan
- Jaiprakash Power Ventures ltd
- Agrawal Coal Company - India
- Attock Cement Pakistan Limited
- Georgia Ports Authority, United States
- AsiaOL BioFuels Corp., Philippines
- Merrill Lynch Commodities Europe
- Vizag Seaport Private Limited - India
- Maheswari Brothers Coal Limited - India
- Aditya Birla Group - India
- OPG Power Generation Pvt Ltd - India
- PetroVietnam Power Coal Import and Supply Company
- Barasentosa Lestari - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Malabar Cements Ltd - India
- Metalloyd Limited - United Kingdom
- Globalindo Alam Lestari - Indonesia
- Thiess Contractors Indonesia
- Global Business Power Corporation, Philippines
- TeaM Sual Corporation - Philippines
- Krishnapatnam Port Company Ltd. - India
- Global Green Power PLC Corporation, Philippines
- Toyota Tsusho Corporation, Japan
- Jindal Steel & Power Ltd - India
- TNB Fuel Sdn Bhd - Malaysia
- GAC Shipping (India) Pvt Ltd
- Bangladesh Power Developement Board
- Posco Energy - South Korea
- Sarangani Energy Corporation, Philippines
- Standard Chartered Bank - UAE
- McConnell Dowell - Australia
- Port Waratah Coal Services - Australia
- Energy Development Corp, Philippines
- Bank of Tokyo Mitsubishi UFJ Ltd
- Bharathi Cement Corporation - India
- New Zealand Coal & Carbon
- Coal and Oil Company - UAE
- Simpson Spence & Young - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Independent Power Producers Association of India
- Bahari Cakrawala Sebuku - Indonesia
- Chamber of Mines of South Africa
- Trasteel International SA, Italy
- Siam City Cement PLC, Thailand
- Tata Chemicals Ltd - India
- Manunggal Multi Energi - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Ministry of Mines - Canada
- India Bulls Power Limited - India
- Xindia Steels Limited - India
- Carbofer General Trading SA - India
- Iligan Light & Power Inc, Philippines
- Meenaskhi Energy Private Limited - India
- Bhushan Steel Limited - India
- GMR Energy Limited - India
- Kideco Jaya Agung - Indonesia
- ICICI Bank Limited - India
- Ind-Barath Power Infra Limited - India
- Leighton Contractors Pty Ltd - Australia
- Thai Mozambique Logistica
- Bhatia International Limited - India
- Eastern Energy - Thailand
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Kaltim Prima Coal - Indonesia
- ASAPP Information Group - India
- Interocean Group of Companies - India
- Intertek Mineral Services - Indonesia
- Madhucon Powers Ltd - India
- Indian Oil Corporation Limited
- Bulk Trading Sa - Switzerland
- PTC India Limited - India
- The State Trading Corporation of India Ltd
- Orica Australia Pty. Ltd.
- Marubeni Corporation - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Straits Asia Resources Limited - Singapore
- Antam Resourcindo - Indonesia
- Lanco Infratech Ltd - India
- Semirara Mining and Power Corporation, Philippines
- Central Java Power - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Eastern Coal Council - USA
- PowerSource Philippines DevCo
- Borneo Indobara - Indonesia
- Bayan Resources Tbk. - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Kepco SPC Power Corporation, Philippines
- White Energy Company Limited
- Aboitiz Power Corporation - Philippines
- Siam City Cement - Thailand
- Wilmar Investment Holdings
- Mercuria Energy - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- South Luzon Thermal Energy Corporation
- Kumho Petrochemical, South Korea
- Banpu Public Company Limited - Thailand
- Oldendorff Carriers - Singapore
- Electricity Authority, New Zealand
- Indo Tambangraya Megah - Indonesia
- Planning Commission, India
- Latin American Coal - Colombia
- Economic Council, Georgia
- Price Waterhouse Coopers - Russia
- Coalindo Energy - Indonesia
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