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Wednesday, 07 September 16
WEEKLY MARKET (TANKER) REPORT - INTERMODAL
 What goes around comes around! The Shipping industry is infamous for its seasonality and cyclicality and the tanker sector is no exception to these characteristics. Although trying to predict the market is never easy, digging into the fundamentals, along with the behavioral aspects that drive it, is probably the only way to go.
On one side there is the bear. There is no other factor more important than the actual demand for the physical commodity and its growth prospects have fallen behind expectations, as EIA’s data forecast the average price of Brent blend at $42/bbl for the current year and at $52/bbl for 2017. These numbers suggest that, despite its current short-term fluctuations between $40 and $50, crude oil market is in contango in the long-term. But the crucial factors that not only back-up these statements but also play their own role in dragging down the oil prices do not stop there. Add to the mix the excessive inventory building in both shore and floating tanks and the lower refinery margins and it would appear that the glut is here and is here to stay. Or is it?
On the other side there is the bull. Surprisingly, at the same time that the world’s biggest oil producer followed by Iran, Iraq and other OPEC members are pumping at historical record rates, the markets rallied from approximately $40 to almost $49 for an approximate 20% flat price increase in 7 trading days within August! Rational? No! Did it happen? It most certainly did! The lesson to be learned here is that even though the fundamentals may suggest a softening market, it only takes one statement from OPEC’s leading member to reverse the whole sentiment. “The situation will be discussed” said Saudi Arabia’s current minister and the markets obeyed.
To freeze or not to freeze? That is the million dollar question that the much anticipated OPEC meeting needs to answer for the markets to stabilize. However, it has already been proven that the statements of the cartel’s members are not always consistent with their actions and in this irrational market actions may not speak louder than words as record pumping rates firm the oil market instead of softening it!
But the uncertainty about the future does not stop at the primary crude oil market since the derivative oil product market closely follows its steps. An examination of the inventories in gasoline and diesel as benchmarks of the clean oil products across Europe, Asia and the USA reveals that these markets are also in contango. As a result, prices are pressured down with a direct impact to lower tanker rates for almost all the clean tanker segment. Furthermore, regional spreads that create arbitrage trading opportunities are diminishing, leading to lower rates for regional short-haul voyages performed by small tankers.
The most profound conclusion of the above is uncertainty in expectations, which results in volatility in both crude and product markets. These features are depicted in tanker rates, as the adverse conditions that exist in the oil markets surely enough spill over into the tanker markets. Thus, without owning the magic crystal ball, it would most probably be naïve to try to make a prediction about the future under current conditions. This situation may be a playground for oil traders who thrive on volatility, but a headache for tanker shipowners who may be called to tackle with another recession and try to ride the cycle one more time.
By Konstantinos Kakavitsas
Tanker Chartering
Compiled by:
Intermodal Research & Valuations
Analysts:
Ms. Eva Tzima
Disclaimer and legal disclosure: For any further queries please do not hesitate to contact our Research & Valuations Department. The information contained in this report has been obtained from various sources, as reported in the market. Intermodal Shipbrokers Co. believes such information to be factual and reliable without making guarantees regarding its accuracy or completeness. Whilst every care has been taken in the production of the above review, no liability can be accepted for any loss or damage incurred in any way whatsoever by any person who may seek to rely on the information and views contained in this material. This report is being produced for the internal use of the intended recipients only and no reproducing is allowed, without the prior written authorization of Intermodal Shipbrokers Co.
The Information contained within the website of COALspot.com is intended for informational purposes only and is not intended as professional counsel and should not be used as such.
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Sunday, 04 December 16
U.S. WEEKLY COAL OUTPUT DECLINED 11.9% W/E 26 NOV; UP 1.4% Y/Y, EIA
COALspot.com – U.S., the world’s second largest coal producers have produced approximately totalled an estimated 15.2 million short ton ...
Thursday, 01 December 16
OIL PRICES MAY SEE LITTLE GROWTH BEFORE 2018, FITCH RATINGS SAYS
High inventories and the potential for US shale production to respond quickly to any market tightening mean oil prices may flat line in 2017 before ...
Thursday, 01 December 16
CHINA 2017 OIL, GAS OUTPUT DROP MAY WORSEN ON CAPEX CUT: FITCH
China's oil and gas production may shrink even more in 2017 than in 2016 after the country's leading oil companies cut exploration and prod ...
Thursday, 01 December 16
ANOTHER WONDERFUL WEEK FOR PANAMAX - FEARNLEY
Supramax
A slower start to the week in the Pacific compared to last Trips from N. China to S. China is paying in the range of low USD 5k, while I ...
Tuesday, 29 November 16
AUSTRALIA'S PORT OF NEWCASTLE SHIPPED 13.08 MT OF COAL IN OCTOBER; DOWN 10.39% M/M
COALspot.com: The Port of Newcastle, Australia’s major trading ports and the world’s largest coal export port has shipped $AU1,124.7 Mi ...
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- Independent Power Producers Association of India
- Ministry of Mines - Canada
- Bahari Cakrawala Sebuku - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Petron Corporation, Philippines
- Pipit Mutiara Jaya. PT, Indonesia
- McConnell Dowell - Australia
- Essar Steel Hazira Ltd - India
- Minerals Council of Australia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Indonesian Coal Mining Association
- Kaltim Prima Coal - Indonesia
- Mjunction Services Limited - India
- Kartika Selabumi Mining - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Kumho Petrochemical, South Korea
- Bulk Trading Sa - Switzerland
- Cigading International Bulk Terminal - Indonesia
- CIMB Investment Bank - Malaysia
- Directorate General of MIneral and Coal - Indonesia
- Oldendorff Carriers - Singapore
- Pendopo Energi Batubara - Indonesia
- Posco Energy - South Korea
- Chettinad Cement Corporation Ltd - India
- Energy Link Ltd, New Zealand
- Agrawal Coal Company - India
- SN Aboitiz Power Inc, Philippines
- Sical Logistics Limited - India
- Intertek Mineral Services - Indonesia
- Goldman Sachs - Singapore
- Bayan Resources Tbk. - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Leighton Contractors Pty Ltd - Australia
- Grasim Industreis Ltd - India
- Orica Mining Services - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- IHS Mccloskey Coal Group - USA
- Siam City Cement PLC, Thailand
- Sakthi Sugars Limited - India
- Central Java Power - Indonesia
- Cement Manufacturers Association - India
- India Bulls Power Limited - India
- Aboitiz Power Corporation - Philippines
- Global Business Power Corporation, Philippines
- Electricity Generating Authority of Thailand
- Georgia Ports Authority, United States
- Karbindo Abesyapradhi - Indoneisa
- Rashtriya Ispat Nigam Limited - India
- Iligan Light & Power Inc, Philippines
- Eastern Coal Council - USA
- Kapuas Tunggal Persada - Indonesia
- Mintek Dendrill Indonesia
- Mercator Lines Limited - India
- Merrill Lynch Commodities Europe
- The Treasury - Australian Government
- Parliament of New Zealand
- ICICI Bank Limited - India
- Indian Energy Exchange, India
- Edison Trading Spa - Italy
- Gujarat Mineral Development Corp Ltd - India
- AsiaOL BioFuels Corp., Philippines
- VISA Power Limited - India
- Power Finance Corporation Ltd., India
- Baramulti Group, Indonesia
- Jaiprakash Power Ventures ltd
- Banpu Public Company Limited - Thailand
- Anglo American - United Kingdom
- San Jose City I Power Corp, Philippines
- The University of Queensland
- Wood Mackenzie - Singapore
- Ind-Barath Power Infra Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Kalimantan Lumbung Energi - Indonesia
- Romanian Commodities Exchange
- Videocon Industries ltd - India
- Vizag Seaport Private Limited - India
- Planning Commission, India
- Ambuja Cements Ltd - India
- Simpson Spence & Young - Indonesia
- Price Waterhouse Coopers - Russia
- Neyveli Lignite Corporation Ltd, - India
- Australian Coal Association
- Trasteel International SA, Italy
- Manunggal Multi Energi - Indonesia
- Barasentosa Lestari - Indonesia
- Bharathi Cement Corporation - India
- CNBM International Corporation - China
- Tata Chemicals Ltd - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Indogreen Group - Indonesia
- Indika Energy - Indonesia
- ASAPP Information Group - India
- OPG Power Generation Pvt Ltd - India
- Samtan Co., Ltd - South Korea
- European Bulk Services B.V. - Netherlands
- Sojitz Corporation - Japan
- Xindia Steels Limited - India
- Latin American Coal - Colombia
- South Luzon Thermal Energy Corporation
- The State Trading Corporation of India Ltd
- Therma Luzon, Inc, Philippines
- Antam Resourcindo - Indonesia
- Binh Thuan Hamico - Vietnam
- Riau Bara Harum - Indonesia
- Carbofer General Trading SA - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Parry Sugars Refinery, India
- IEA Clean Coal Centre - UK
- SMG Consultants - Indonesia
- Borneo Indobara - Indonesia
- PNOC Exploration Corporation - Philippines
- Bhoruka Overseas - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Kideco Jaya Agung - Indonesia
- Central Electricity Authority - India
- Directorate Of Revenue Intelligence - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Uttam Galva Steels Limited - India
- Sree Jayajothi Cements Limited - India
- Maheswari Brothers Coal Limited - India
- PowerSource Philippines DevCo
- Salva Resources Pvt Ltd - India
- LBH Netherlands Bv - Netherlands
- Gujarat Electricity Regulatory Commission - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Renaissance Capital - South Africa
- Tamil Nadu electricity Board
- Sinarmas Energy and Mining - Indonesia
- Eastern Energy - Thailand
- Savvy Resources Ltd - HongKong
- Australian Commodity Traders Exchange
- Rio Tinto Coal - Australia
- International Coal Ventures Pvt Ltd - India
- Madhucon Powers Ltd - India
- Malabar Cements Ltd - India
- Bukit Baiduri Energy - Indonesia
- Wilmar Investment Holdings
- Coal and Oil Company - UAE
- Thiess Contractors Indonesia
- Sarangani Energy Corporation, Philippines
- Lanco Infratech Ltd - India
- GVK Power & Infra Limited - India
- Metalloyd Limited - United Kingdom
- Standard Chartered Bank - UAE
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Deloitte Consulting - India
- Makarim & Taira - Indonesia
- Kobexindo Tractors - Indoneisa
- Global Green Power PLC Corporation, Philippines
- Bukit Makmur.PT - Indonesia
- Heidelberg Cement - Germany
- Africa Commodities Group - South Africa
- Siam City Cement - Thailand
- Thai Mozambique Logistica
- New Zealand Coal & Carbon
- Interocean Group of Companies - India
- Krishnapatnam Port Company Ltd. - India
- White Energy Company Limited
- Singapore Mercantile Exchange
- Meenaskhi Energy Private Limited - India
- GMR Energy Limited - India
- Globalindo Alam Lestari - Indonesia
- Bhushan Steel Limited - India
- Electricity Authority, New Zealand
- Sindya Power Generating Company Private Ltd
- GAC Shipping (India) Pvt Ltd
- Asmin Koalindo Tuhup - Indonesia
- Energy Development Corp, Philippines
- MS Steel International - UAE
- Economic Council, Georgia
- Meralco Power Generation, Philippines
- Timah Investasi Mineral - Indoneisa
- Ministry of Finance - Indonesia
- Aditya Birla Group - India
- Mercuria Energy - Indonesia
- Kepco SPC Power Corporation, Philippines
- Dalmia Cement Bharat India
- Medco Energi Mining Internasional
- Vedanta Resources Plc - India
- Straits Asia Resources Limited - Singapore
- Toyota Tsusho Corporation, Japan
- Miang Besar Coal Terminal - Indonesia
- Marubeni Corporation - India
- Holcim Trading Pte Ltd - Singapore
- Coalindo Energy - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Bangladesh Power Developement Board
- Chamber of Mines of South Africa
- Global Coal Blending Company Limited - Australia
- Semirara Mining Corp, Philippines
- Indo Tambangraya Megah - Indonesia
- Ministry of Transport, Egypt
- Jindal Steel & Power Ltd - India
- Semirara Mining and Power Corporation, Philippines
- Jorong Barutama Greston.PT - Indonesia
- Altura Mining Limited, Indonesia
- London Commodity Brokers - England
- TeaM Sual Corporation - Philippines
- Larsen & Toubro Limited - India
- Orica Australia Pty. Ltd.
- PTC India Limited - India
- Commonwealth Bank - Australia
- Vijayanagar Sugar Pvt Ltd - India
- Indian Oil Corporation Limited
- Bhatia International Limited - India
- Star Paper Mills Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- SMC Global Power, Philippines
- Coastal Gujarat Power Limited - India
- Karaikal Port Pvt Ltd - India
- Attock Cement Pakistan Limited
- Alfred C Toepfer International GmbH - Germany
- Formosa Plastics Group - Taiwan
- Bukit Asam (Persero) Tbk - Indonesia
- Port Waratah Coal Services - Australia
- Gujarat Sidhee Cement - India
- Maharashtra Electricity Regulatory Commission - India
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