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Wednesday, 10 June 20
OPEC+ CUTS EXTENSION TO ACCELERATE MARKET REBALANCING - FITCH RATINGS
 Fitch Ratings-London-08 June 2020: The OPEC+ agreement to extend by one month record oil production cuts should accelerate market rebalancing, Fitch Ratings says. This is further supported by a commitment to improve compliance from those countries that were unable to reach full conformity with the cuts.
The OPEC+ countries have made radical production cuts in the stress scenario, but it may be more difficult to reach a consensus when the worst of the crisis is over. And it is unclear whether the recovery in oil prices to date is sustainable. Furthermore, demand and production in non-OPEC+ countries, notably the US, will continue to have a significant impact on the supply-demand balance and prices. We believe that a normalisation of oil inventory built up in 1H20 will take at least several months.
Crude oil prices rose significantly in May and continued to improve in early June, because the surplus has been reduced materially. A price differential between the physical and financial markets has disappeared, pointing to crude oil market tightening. We believe that a stress case scenario with prices falling significantly below USD30/bbl is now less likely. The market is likely to experience a production deficit in 2H20 due to gradually improving demand and reduced supply.
The OPEC+ cuts were the major contributor to market rebalancing. We estimate that the OPEC+ countries reduced production by around 7.5mmbpd in May compared to March. The cumulative OPEC+ cuts should exceed 9mmbpd in June as Saudi Arabia, Kuwait and UAE have committed to cut an additional 1.1mmbpd, while Iraq and Nigeria, which underperformed in May, have promised to improve compliance in June. A resumption of production in Libya, which is not subject to the OPEC+ deal, may increase supply but should be more than offset by additional cuts elsewhere.
Furthermore, production fell in the US as a result both of shut-ins and reduced drilling activity by almost 2mmbpd at end-May compared to March, while Canada cut around 1mmbpd. The number of active drilling rigs in the US declined by 64% compared to the beginning of the year. Production in North America may continue to shrink for a while, but the pace is likely to decelerate due to increased prices. We believe that at USD30/bbl, many producers should be able to stabilise production, while at USD40/bbl or above some would be tempted to increase output, which could limit price recovery.
Estimates suggest crude oil demand increased in May compared to April, and we believe it will improve further from June due to the gradual lifting of lockdown restrictions. Implied oil products consumption in the US improved from a 28% drop in April yoy to a 20% drop in May, driven mainly by increased gasoline consumption (a yoy decline of 25% in May compared to a 44% decline in April), while the consumption of jet fuel remained flat. We believe consumption patterns are similar in Europe, while demand in China bottomed out in February.
Demand recovery is now key in achieving balance in the oil market. It could be undermined in the event of a second coronavirus wave and the re-introduction of lockdowns, although it is not our base case. While consumption of gasoline and diesel could recover by the year-end, jet fuel may lag behind as international travel restrictions may remain in place and demand for business travel may be structurally impaired.
Our ratings are informed by companies’ projected performance at end-2021, rather than in 2020, provided their liquidity is adequate, as we rate “through the cycle”. While we may recalibrate our near-term oil price assumptions to the pace of market rebalancing, our ratings already assume that the market will recover gradually; therefore the most recent improvements will not prompt portfolio-wide rating actions.
Source: Fitch Ratings
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Saturday, 06 June 20
KOREA SOUTH-EAST POWER CO INVITED COAL BIDS FOR MIN 5600 NCV COAL
COALspot.com: South Korea’s KOREA SOUTH-EAST POWER CO., LTD. (KOEN) has issued an international tender for 270,000 Tons (MT) min. 5600 NCV co ...
Friday, 05 June 20
COAL INDIA ESTIMATES PRODUCTION GROWTH BY OVERBURDEN REMOVAL - FINANCIAL EXPRESS
PSU miner Coal India (CIL) has now limited mining only to Overburden Removal (OBR) with falling demand of coal. The mining behemoth is now keeping ...
Friday, 05 June 20
U.S. SANCTIONS COMPLIANCE GUIDANCE RELEASED FOR THE GLOBAL MARITIME, ENERGY AND METALS SECTORS - AKIN GUMP
Key Points
On May 14, 2020, OFAC, the Department of State and the U.S. Coast Guard jointly released guidance for persons involved in the ma ...
Friday, 05 June 20
IN THE FIRST 5 MONTHS OF 2020 AUSTRALIA SHIPPED 6.8 MLN TONNES TO VIETNAM - BANCHERO COSTA
In the first 5 months of 2020, global seaborne coal trade declined by as much as -8% year-on-year, according to vessel tracking data from Ref ...
Thursday, 04 June 20
CHINA'S BENCHMARK POWER COAL PRICE EDGES UP - XINHUA
China’s benchmark power coal price rose slightly during the past week.
The Bohai-Rim Steam-Coal Price Index (BSPI), a gauge of ...
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- Australian Commodity Traders Exchange
- Australian Coal Association
- Kobexindo Tractors - Indoneisa
- Pendopo Energi Batubara - Indonesia
- Parry Sugars Refinery, India
- Antam Resourcindo - Indonesia
- Samtan Co., Ltd - South Korea
- Billiton Holdings Pty Ltd - Australia
- Renaissance Capital - South Africa
- Manunggal Multi Energi - Indonesia
- Indian Oil Corporation Limited
- Directorate General of MIneral and Coal - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Tamil Nadu electricity Board
- ASAPP Information Group - India
- Edison Trading Spa - Italy
- CIMB Investment Bank - Malaysia
- Orica Mining Services - Indonesia
- IHS Mccloskey Coal Group - USA
- Medco Energi Mining Internasional
- GMR Energy Limited - India
- Semirara Mining and Power Corporation, Philippines
- Iligan Light & Power Inc, Philippines
- Sree Jayajothi Cements Limited - India
- Indian Energy Exchange, India
- PetroVietnam Power Coal Import and Supply Company
- Globalindo Alam Lestari - Indonesia
- Videocon Industries ltd - India
- Mercuria Energy - Indonesia
- Metalloyd Limited - United Kingdom
- Bukit Asam (Persero) Tbk - Indonesia
- Central Java Power - Indonesia
- McConnell Dowell - Australia
- Ministry of Finance - Indonesia
- South Luzon Thermal Energy Corporation
- Sakthi Sugars Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Petron Corporation, Philippines
- Central Electricity Authority - India
- Economic Council, Georgia
- Meralco Power Generation, Philippines
- International Coal Ventures Pvt Ltd - India
- Independent Power Producers Association of India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Indogreen Group - Indonesia
- CNBM International Corporation - China
- TNB Fuel Sdn Bhd - Malaysia
- Larsen & Toubro Limited - India
- Aditya Birla Group - India
- Gujarat Electricity Regulatory Commission - India
- Pipit Mutiara Jaya. PT, Indonesia
- Uttam Galva Steels Limited - India
- Ambuja Cements Ltd - India
- Timah Investasi Mineral - Indoneisa
- Tata Chemicals Ltd - India
- Salva Resources Pvt Ltd - India
- Coalindo Energy - Indonesia
- Intertek Mineral Services - Indonesia
- Semirara Mining Corp, Philippines
- Karbindo Abesyapradhi - Indoneisa
- Leighton Contractors Pty Ltd - Australia
- Posco Energy - South Korea
- Bharathi Cement Corporation - India
- Petrochimia International Co. Ltd.- Taiwan
- Agrawal Coal Company - India
- Rashtriya Ispat Nigam Limited - India
- New Zealand Coal & Carbon
- SMG Consultants - Indonesia
- Jindal Steel & Power Ltd - India
- PowerSource Philippines DevCo
- Jaiprakash Power Ventures ltd
- Anglo American - United Kingdom
- Thiess Contractors Indonesia
- Goldman Sachs - Singapore
- Thai Mozambique Logistica
- ICICI Bank Limited - India
- The University of Queensland
- Port Waratah Coal Services - Australia
- Dalmia Cement Bharat India
- Eastern Energy - Thailand
- Sindya Power Generating Company Private Ltd
- Planning Commission, India
- Makarim & Taira - Indonesia
- Grasim Industreis Ltd - India
- Alfred C Toepfer International GmbH - Germany
- SN Aboitiz Power Inc, Philippines
- Toyota Tsusho Corporation, Japan
- GVK Power & Infra Limited - India
- Altura Mining Limited, Indonesia
- Africa Commodities Group - South Africa
- Neyveli Lignite Corporation Ltd, - India
- Carbofer General Trading SA - India
- Kohat Cement Company Ltd. - Pakistan
- Formosa Plastics Group - Taiwan
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- PNOC Exploration Corporation - Philippines
- Binh Thuan Hamico - Vietnam
- Wood Mackenzie - Singapore
- Kepco SPC Power Corporation, Philippines
- OPG Power Generation Pvt Ltd - India
- Aboitiz Power Corporation - Philippines
- India Bulls Power Limited - India
- Borneo Indobara - Indonesia
- Sinarmas Energy and Mining - Indonesia
- Orica Australia Pty. Ltd.
- Siam City Cement PLC, Thailand
- Sical Logistics Limited - India
- Attock Cement Pakistan Limited
- Global Green Power PLC Corporation, Philippines
- Madhucon Powers Ltd - India
- Miang Besar Coal Terminal - Indonesia
- Price Waterhouse Coopers - Russia
- Indika Energy - Indonesia
- PTC India Limited - India
- Holcim Trading Pte Ltd - Singapore
- Ind-Barath Power Infra Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Electricity Generating Authority of Thailand
- Simpson Spence & Young - Indonesia
- Bangladesh Power Developement Board
- Vedanta Resources Plc - India
- Kartika Selabumi Mining - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Indonesian Coal Mining Association
- Eastern Coal Council - USA
- Oldendorff Carriers - Singapore
- MS Steel International - UAE
- LBH Netherlands Bv - Netherlands
- London Commodity Brokers - England
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Karaikal Port Pvt Ltd - India
- Chamber of Mines of South Africa
- Bayan Resources Tbk. - Indonesia
- Siam City Cement - Thailand
- Bhushan Steel Limited - India
- Singapore Mercantile Exchange
- Therma Luzon, Inc, Philippines
- European Bulk Services B.V. - Netherlands
- Romanian Commodities Exchange
- Straits Asia Resources Limited - Singapore
- Ministry of Transport, Egypt
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- SMC Global Power, Philippines
- Coal and Oil Company - UAE
- Rio Tinto Coal - Australia
- Bukit Baiduri Energy - Indonesia
- Energy Development Corp, Philippines
- Offshore Bulk Terminal Pte Ltd, Singapore
- Meenaskhi Energy Private Limited - India
- Trasteel International SA, Italy
- Savvy Resources Ltd - HongKong
- Jorong Barutama Greston.PT - Indonesia
- Mintek Dendrill Indonesia
- Banpu Public Company Limited - Thailand
- Bhatia International Limited - India
- AsiaOL BioFuels Corp., Philippines
- The Treasury - Australian Government
- Kumho Petrochemical, South Korea
- Electricity Authority, New Zealand
- Kideco Jaya Agung - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Riau Bara Harum - Indonesia
- Power Finance Corporation Ltd., India
- GN Power Mariveles Coal Plant, Philippines
- Bhoruka Overseas - Indonesia
- Interocean Group of Companies - India
- Kaltim Prima Coal - Indonesia
- Standard Chartered Bank - UAE
- Global Coal Blending Company Limited - Australia
- Deloitte Consulting - India
- Commonwealth Bank - Australia
- Marubeni Corporation - India
- Ministry of Mines - Canada
- Asmin Koalindo Tuhup - Indonesia
- Minerals Council of Australia
- Gujarat Mineral Development Corp Ltd - India
- The State Trading Corporation of India Ltd
- Cement Manufacturers Association - India
- Essar Steel Hazira Ltd - India
- Lanco Infratech Ltd - India
- VISA Power Limited - India
- White Energy Company Limited
- Parliament of New Zealand
- Mercator Lines Limited - India
- Mjunction Services Limited - India
- IEA Clean Coal Centre - UK
- Latin American Coal - Colombia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Bulk Trading Sa - Switzerland
- Vijayanagar Sugar Pvt Ltd - India
- Bukit Makmur.PT - Indonesia
- Indo Tambangraya Megah - Indonesia
- Georgia Ports Authority, United States
- Chettinad Cement Corporation Ltd - India
- Baramulti Group, Indonesia
- Malabar Cements Ltd - India
- Global Business Power Corporation, Philippines
- TeaM Sual Corporation - Philippines
- San Jose City I Power Corp, Philippines
- Sojitz Corporation - Japan
- Energy Link Ltd, New Zealand
- Vizag Seaport Private Limited - India
- Sarangani Energy Corporation, Philippines
- Barasentosa Lestari - Indonesia
- Coastal Gujarat Power Limited - India
- Maheswari Brothers Coal Limited - India
- Xindia Steels Limited - India
- Krishnapatnam Port Company Ltd. - India
- GAC Shipping (India) Pvt Ltd
- Cigading International Bulk Terminal - Indonesia
- Merrill Lynch Commodities Europe
- Wilmar Investment Holdings
- Directorate Of Revenue Intelligence - India
- Gujarat Sidhee Cement - India
- Heidelberg Cement - Germany
- Star Paper Mills Limited - India
- Ceylon Electricity Board - Sri Lanka
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