We welcome article submissions from experts in the areas of coal, mining,
shipping, etc.
To Submit your article please click here.
|
|
|
Sunday, 11 October 15
TANKER SHIPPING: MORE OPTIMISM IN SIGHT FOR TANKERS IN THE WINTER SEASON - BIMCO
 Demand:
2015 has been the year of the tanker. The fundamental improvements with slow supply-side growth for some years coupled with low oil prices from mid-2014 created strength on both sides. Freight rates started to take off in October 2014 for all types and sizes. The combination of an early start to the fourth-quarter seasonal strength heading into winter and the fact that the oil prices continued to slide became a catalyst.
Throughout 2015, the global refinery throughput has been on a rise. The normal seasonal lower throughput in the first half of the year with widespread maintenance did not occur. Owing to rising and already elevated refinery margins from East to West, refineries simply wanted all the crude oil they could get. This development still provides strong demand and solid freight rates for the tanker industry. In India, we saw a record of 4.74 million barrels per day (mb/d) of crude throughput in June, marking a truly global trend, whereas Middle Eastern refineries also hit a record throughput because of increased runs in Saudi Arabia.
October is traditionally another month of lower throughput as refineries get ready for the winter season when crude runs normally peak. Moreover, the American “Labor Day” on 7 September marks the end of the US driving season which started on Memorial Day, 25 May. This means that the recent 10mb/d production of gasoline will come down.
Some of that weakness may already have caused freight rates to come down sharply, in combination with the global financial uncertainties originating from China. Very large crude Carriers (VLCCs), Suezmax and Aframax have seen freight rates cut in two since mid-June, while Handysize has been the one to drop the most among oil product tankers.
In a rush of excitement, it’s easily forgotten that such high refinery crude runs can only go on for so long, if end consumption supports it. End consumption has supported it some of the way but not all the way. Swollen stocks of crude oil and oil products are now seen everywhere. Preliminary OECD total industry stock change in second-quarter was 1.1mb/d. All stocks but gasoline increased, US crude oil stocks too. In comparison global oil demand dropped by 0.1mb/d over the same period of time and is expected to see an increase of 1.6mb/d to be consumed for the full year over 2014.
Supply:
Contrary to what happens too often, the strong freight markets for oil product tankers have not resulted in a knee-jerk run to the shipyard to order a massive amount of new ships. This stands in opposition to the crude oil tanker orders seen in 2015, as if the lid has come off finally after several years of resisting the temptation.
By end-August 2015, 56 product tankers with a total capacity of 4.8 million DWT, predominantly LR2 (20) and LR1 (21), have been ordered and will be delivered in 2016-17. They are aiming to get a share of the market for longer-haul trades out of Middle East refineries, predominantly into the Western markets. This ordering trend has been on for two years now.
Among the crude oil tanker segments, we have already seen more orders for both Aframax and VLCCs than we did in the whole of 2014. Aframax in particular has been popular with investors this year; after six years with one order a month on average, 2015 has seen 29 new contracts in the first eight months. For the VLCCs, the orders with delivery in particular 2017 (21) and in 2018 (14) have been favoured by investors. In 2015, 50 new VLCC contracts in total have been signed.
One of the launchers which has lifted the freight rates into orbit is two years of very slow fleet growth. Today the fleet holds 648 VLCCs, whereas 628 VLCCs were active by mid-2013. That’s a growth of just 3% in 26 months. Looking forward into the future inflow of crude oil tankers, we can see the delivery pace is picking up and the demolition potential is vanishing with just 14 VLCCs being more than 20 years old and another 16 getting inside the window of the fourth special survey in 2016.
On order for a scheduled delivery during the next 16 months are 71 VLCCs. This means a double-paced inflow as it has taken 34 months for the latest 71 VLCCs to be put into active service.
The change in supply-side conditions will slowly tighten the freight market, and as we look into 2016, the tide could turn fundamentally as a fleet growth of 4.4% is likely to outstrip demand growth. As the coming two years are now “full” in terms of remaining in control of supply-side growth, any additional crude oil tanker orders should be placed for 2018 delivery.
BIMCO forecasts the present and next year supply growth for oil product tankers to be at 5.4% and 5.7% respectively, meaning two “full” years too for that segment.
Outlook:
Looking forward, the winter markets are expected to soften, as the eventual lower refinery crude oil throughput when no more stocks can be filled and margins begin to crumble as demand slips. Until then BIMCO expects earnings for both crude oil and oil product tankers to remain strong. Our expectations are primarily supported by low fleet growth for crude oil tankers and long-haul trades for oil product tankers.
High volatility in freight rates can be expected in the coming half year half a year, when it may also be prudent to look at the time charter market, where one- and three-year time charter rates are both at their highest level since 2009. At USD 48,000 per day and USD 43,500 per day, time charters will make positive returns after all costs inclusive of capital cost and depreciations are deducted.
In the longer run, an eventual repeal of the US crude oil export ban will likely have some impact on the tanker trading lanes. The US congress is set to vote on the issues during this autumn. For the supporters the case is clear: US refineries are saturated with light sweet crude which is produced abundantly. For those in favour of keeping the crude oil export ban still in place there is “national interest”, which currently seems to hold the upper hand. Currently, the only crude oil exports today go to Canada (0.5mb/d).
Moreover, the eventual lifting of international sanctions on Iran is likely to see a steady increase in crude oil, both sweet and sour, into the market over the coming one to three years, depending on much-needed investments to boost production and time to regain market shares. BIMCO expects the re-entry of Iranian crude oil into the market will change trade patterns as other suppliers will be squeezed on their market share. The key will be West African produced sweet crude now going to Europe and East Asia. The latter is the vital one and a stronghold behind the current upturn. The overall impact on the tanker earnings from these changes holds the potential to become both negative and positive.
Source: BIMCO | Hellenic Shipping News
If you believe an article violates your rights or the rights of others, please contact us.
|
|
Sunday, 18 October 15
THE BDI AND OTHER INDICES CLOSED OFF ON NEGATIVE NOTE THIS FRIDAY
COALspot.com: The BDI closed off on negative note this Friday compared to previous Friday's closing.
The BDI closed this Friday (16 Octobe ...
Friday, 16 October 15
MAJOR REVISION OF NYPE TIME CHAPTER PARTY - BIMCO
Major revision of NYPE time charter party promises to be both balanced and comprehensive
BIMCO has today jointly issued the first revision of ...
Friday, 16 October 15
FOB INDONESIA COAL SWAP FOR Q4'15 DELIVERY FLAT WEEK OVER WEEK; DOWN 5.5 PER CENT M-M
COALspot.com: Indonesian coal swap for delivery Q4 2015 declined month on month and flat week over week.
The Q4 swap declined $ 2.23 (-5.51%) ...
Friday, 16 October 15
COAL PRODUCTION IN THE UNITED STATES DECREASED THIS WEEK; DOWN 11.3 PER CENT Y-Y, DOWN 3.5 PERCENT W-W
COALspot.com – United States the world’s second largest coal producer has produced approximately totaled an estimated 17.1 million shor ...
Friday, 16 October 15
INDONESIA REJOINING OPEC DESPITE BEING A NET IMPORTER OF PETROLEUM - EIA
The Organization of the Petroleum Exporting Countries (OPEC) notified Indonesia that it plans to accept the country's request to reactivate its ...
|
|
|
Showing 2766 to 2770 news of total 6871 |
|
 |
|
|
|
|
| |
|
 |
|
|
| |
|
- Toyota Tsusho Corporation, Japan
- SMC Global Power, Philippines
- Coastal Gujarat Power Limited - India
- Jorong Barutama Greston.PT - Indonesia
- Singapore Mercantile Exchange
- Salva Resources Pvt Ltd - India
- Heidelberg Cement - Germany
- CNBM International Corporation - China
- Renaissance Capital - South Africa
- Energy Development Corp, Philippines
- Maharashtra Electricity Regulatory Commission - India
- SMG Consultants - Indonesia
- Mjunction Services Limited - India
- Power Finance Corporation Ltd., India
- Vedanta Resources Plc - India
- PetroVietnam Power Coal Import and Supply Company
- Vijayanagar Sugar Pvt Ltd - India
- ICICI Bank Limited - India
- Parliament of New Zealand
- Australian Coal Association
- Holcim Trading Pte Ltd - Singapore
- Kumho Petrochemical, South Korea
- Offshore Bulk Terminal Pte Ltd, Singapore
- Altura Mining Limited, Indonesia
- Carbofer General Trading SA - India
- Anglo American - United Kingdom
- Alfred C Toepfer International GmbH - Germany
- Edison Trading Spa - Italy
- Indogreen Group - Indonesia
- Maheswari Brothers Coal Limited - India
- Agrawal Coal Company - India
- Neyveli Lignite Corporation Ltd, - India
- Ind-Barath Power Infra Limited - India
- Thiess Contractors Indonesia
- Indian Oil Corporation Limited
- MS Steel International - UAE
- Sinarmas Energy and Mining - Indonesia
- Bhatia International Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Ministry of Mines - Canada
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Planning Commission, India
- Kohat Cement Company Ltd. - Pakistan
- Metalloyd Limited - United Kingdom
- Straits Asia Resources Limited - Singapore
- TeaM Sual Corporation - Philippines
- Orica Mining Services - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Jindal Steel & Power Ltd - India
- GAC Shipping (India) Pvt Ltd
- Ambuja Cements Ltd - India
- Jaiprakash Power Ventures ltd
- Siam City Cement - Thailand
- Mintek Dendrill Indonesia
- Krishnapatnam Port Company Ltd. - India
- Sical Logistics Limited - India
- Central Electricity Authority - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- GVK Power & Infra Limited - India
- Ministry of Finance - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- GN Power Mariveles Coal Plant, Philippines
- Leighton Contractors Pty Ltd - Australia
- Savvy Resources Ltd - HongKong
- Semirara Mining Corp, Philippines
- Dalmia Cement Bharat India
- GMR Energy Limited - India
- Directorate General of MIneral and Coal - Indonesia
- Mercuria Energy - Indonesia
- Kideco Jaya Agung - Indonesia
- Meenaskhi Energy Private Limited - India
- Petron Corporation, Philippines
- Uttam Galva Steels Limited - India
- Tamil Nadu electricity Board
- Kepco SPC Power Corporation, Philippines
- Grasim Industreis Ltd - India
- Videocon Industries ltd - India
- LBH Netherlands Bv - Netherlands
- Bayan Resources Tbk. - Indonesia
- Chamber of Mines of South Africa
- Bukit Asam (Persero) Tbk - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Barasentosa Lestari - Indonesia
- Karaikal Port Pvt Ltd - India
- Manunggal Multi Energi - Indonesia
- Interocean Group of Companies - India
- Vizag Seaport Private Limited - India
- London Commodity Brokers - England
- Gujarat Sidhee Cement - India
- Karbindo Abesyapradhi - Indoneisa
- Georgia Ports Authority, United States
- Standard Chartered Bank - UAE
- India Bulls Power Limited - India
- International Coal Ventures Pvt Ltd - India
- Directorate Of Revenue Intelligence - India
- Indian Energy Exchange, India
- Electricity Generating Authority of Thailand
- Coal and Oil Company - UAE
- Pendopo Energi Batubara - Indonesia
- PowerSource Philippines DevCo
- IHS Mccloskey Coal Group - USA
- Asmin Koalindo Tuhup - Indonesia
- Economic Council, Georgia
- White Energy Company Limited
- Latin American Coal - Colombia
- PNOC Exploration Corporation - Philippines
- Makarim & Taira - Indonesia
- Larsen & Toubro Limited - India
- Rio Tinto Coal - Australia
- VISA Power Limited - India
- Star Paper Mills Limited - India
- Timah Investasi Mineral - Indoneisa
- Global Business Power Corporation, Philippines
- Antam Resourcindo - Indonesia
- Africa Commodities Group - South Africa
- Deloitte Consulting - India
- Semirara Mining and Power Corporation, Philippines
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Sojitz Corporation - Japan
- Price Waterhouse Coopers - Russia
- The Treasury - Australian Government
- Sarangani Energy Corporation, Philippines
- Sindya Power Generating Company Private Ltd
- Wilmar Investment Holdings
- San Jose City I Power Corp, Philippines
- Bukit Makmur.PT - Indonesia
- European Bulk Services B.V. - Netherlands
- Bukit Baiduri Energy - Indonesia
- Simpson Spence & Young - Indonesia
- Mercator Lines Limited - India
- Australian Commodity Traders Exchange
- AsiaOL BioFuels Corp., Philippines
- Electricity Authority, New Zealand
- Billiton Holdings Pty Ltd - Australia
- Central Java Power - Indonesia
- Oldendorff Carriers - Singapore
- Therma Luzon, Inc, Philippines
- Globalindo Alam Lestari - Indonesia
- Siam City Cement PLC, Thailand
- Borneo Indobara - Indonesia
- Bhushan Steel Limited - India
- Sakthi Sugars Limited - India
- New Zealand Coal & Carbon
- Eastern Energy - Thailand
- Commonwealth Bank - Australia
- Wood Mackenzie - Singapore
- Lanco Infratech Ltd - India
- South Luzon Thermal Energy Corporation
- Baramulti Group, Indonesia
- Aboitiz Power Corporation - Philippines
- Essar Steel Hazira Ltd - India
- Energy Link Ltd, New Zealand
- PTC India Limited - India
- Iligan Light & Power Inc, Philippines
- Samtan Co., Ltd - South Korea
- Orica Australia Pty. Ltd.
- Posco Energy - South Korea
- Trasteel International SA, Italy
- Thai Mozambique Logistica
- Meralco Power Generation, Philippines
- Ceylon Electricity Board - Sri Lanka
- Indika Energy - Indonesia
- Riau Bara Harum - Indonesia
- Eastern Coal Council - USA
- Minerals Council of Australia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Sree Jayajothi Cements Limited - India
- Cigading International Bulk Terminal - Indonesia
- Merrill Lynch Commodities Europe
- SN Aboitiz Power Inc, Philippines
- The State Trading Corporation of India Ltd
- McConnell Dowell - Australia
- Pipit Mutiara Jaya. PT, Indonesia
- Bulk Trading Sa - Switzerland
- ASAPP Information Group - India
- Aditya Birla Group - India
- Binh Thuan Hamico - Vietnam
- Goldman Sachs - Singapore
- Independent Power Producers Association of India
- Bangladesh Power Developement Board
- Banpu Public Company Limited - Thailand
- The University of Queensland
- Kartika Selabumi Mining - Indonesia
- Kapuas Tunggal Persada - Indonesia
- CIMB Investment Bank - Malaysia
- Bhoruka Overseas - Indonesia
- Global Coal Blending Company Limited - Australia
- Coalindo Energy - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Cement Manufacturers Association - India
- IEA Clean Coal Centre - UK
- Tata Chemicals Ltd - India
- Medco Energi Mining Internasional
- Indo Tambangraya Megah - Indonesia
- Global Green Power PLC Corporation, Philippines
- Gujarat Electricity Regulatory Commission - India
- Intertek Mineral Services - Indonesia
- Marubeni Corporation - India
- OPG Power Generation Pvt Ltd - India
- Bahari Cakrawala Sebuku - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Kaltim Prima Coal - Indonesia
- Madhucon Powers Ltd - India
- Indonesian Coal Mining Association
- Malabar Cements Ltd - India
- Ministry of Transport, Egypt
- Kobexindo Tractors - Indoneisa
- Xindia Steels Limited - India
- Romanian Commodities Exchange
- Chettinad Cement Corporation Ltd - India
- TNB Fuel Sdn Bhd - Malaysia
- Formosa Plastics Group - Taiwan
- Parry Sugars Refinery, India
- Port Waratah Coal Services - Australia
- Attock Cement Pakistan Limited
- Bharathi Cement Corporation - India
|
| |
| |
|
