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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.
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Tuesday, 18 October 16
COAL PRICES KEPT CLIMBING
COALspot.com: A rally in thermal coal prices over the past few months, after years of decline, is still continuing and it is expected to rally at l ...
Tuesday, 18 October 16
PANAMAX: A FAIRLY POSITIVE END TO THE WEEK - ALLIED
Capesize
Things seemed to be moving sideways during the first half of the week, with resistance being felt as owners tried to resist any further ...
Monday, 17 October 16
THE FREIGHT MARKET WAS SOFTENED IN ALL SEGMENTS THIS PAST WEEK - VISTAAR
COALspot.com: The Baltic Exchange, tracking rates for ships carrying dry bulk commodities decline slightly and ending in a negative note this past ...
Friday, 14 October 16
SUPRAMAXES: DELIVERY SINGAPORE ARE SETTLING AROUND HIGH 6K'S FOR COAL TRIPS TO CHINA VIA INDO - FEARNLEY
Supramax
Wait and see attitude prevailing all over the market.
There have been several fresh cargoes, which have been efficiently covered by ...
Friday, 14 October 16
U.S. SHIPPED 3.3 MMST COAL IN JULY 2016; DECLINE 40% M/M
COALspot.com – U.S., the world’s second largest coal producers have produced approximately totalled an estimated 16.6 million short ton ...
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- Samtan Co., Ltd - South Korea
- Uttam Galva Steels Limited - India
- Kepco SPC Power Corporation, Philippines
- Minerals Council of Australia
- Edison Trading Spa - Italy
- Sindya Power Generating Company Private Ltd
- Asmin Koalindo Tuhup - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Siam City Cement PLC, Thailand
- Krishnapatnam Port Company Ltd. - India
- Africa Commodities Group - South Africa
- Maheswari Brothers Coal Limited - India
- Therma Luzon, Inc, Philippines
- Leighton Contractors Pty Ltd - Australia
- Grasim Industreis Ltd - India
- Wood Mackenzie - Singapore
- Price Waterhouse Coopers - Russia
- Pipit Mutiara Jaya. PT, Indonesia
- Georgia Ports Authority, United States
- Orica Mining Services - Indonesia
- Wilmar Investment Holdings
- Directorate Of Revenue Intelligence - India
- Baramulti Group, Indonesia
- Bhatia International Limited - India
- Altura Mining Limited, Indonesia
- Alfred C Toepfer International GmbH - Germany
- Formosa Plastics Group - Taiwan
- Sojitz Corporation - Japan
- Gujarat Sidhee Cement - India
- Gujarat Electricity Regulatory Commission - India
- Electricity Authority, New Zealand
- SMG Consultants - Indonesia
- Intertek Mineral Services - Indonesia
- PNOC Exploration Corporation - Philippines
- Standard Chartered Bank - UAE
- International Coal Ventures Pvt Ltd - India
- Simpson Spence & Young - Indonesia
- Makarim & Taira - Indonesia
- Medco Energi Mining Internasional
- Ministry of Transport, Egypt
- Bukit Makmur.PT - Indonesia
- Mjunction Services Limited - India
- Antam Resourcindo - Indonesia
- Singapore Mercantile Exchange
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Kartika Selabumi Mining - Indonesia
- GAC Shipping (India) Pvt Ltd
- Coalindo Energy - Indonesia
- Oldendorff Carriers - Singapore
- Mercuria Energy - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Australian Coal Association
- Central Electricity Authority - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Petron Corporation, Philippines
- Ind-Barath Power Infra Limited - India
- Marubeni Corporation - India
- Barasentosa Lestari - Indonesia
- OPG Power Generation Pvt Ltd - India
- Ministry of Finance - Indonesia
- Romanian Commodities Exchange
- Petrochimia International Co. Ltd.- Taiwan
- Semirara Mining and Power Corporation, Philippines
- San Jose City I Power Corp, Philippines
- Attock Cement Pakistan Limited
- European Bulk Services B.V. - Netherlands
- Thiess Contractors Indonesia
- SN Aboitiz Power Inc, Philippines
- New Zealand Coal & Carbon
- Bangladesh Power Developement Board
- Kaltim Prima Coal - Indonesia
- Eastern Coal Council - USA
- Australian Commodity Traders Exchange
- Pendopo Energi Batubara - Indonesia
- Karaikal Port Pvt Ltd - India
- Directorate General of MIneral and Coal - Indonesia
- Posco Energy - South Korea
- Mintek Dendrill Indonesia
- Miang Besar Coal Terminal - Indonesia
- Coastal Gujarat Power Limited - India
- Thai Mozambique Logistica
- GN Power Mariveles Coal Plant, Philippines
- South Luzon Thermal Energy Corporation
- Manunggal Multi Energi - Indonesia
- Coal and Oil Company - UAE
- MS Steel International - UAE
- Globalindo Alam Lestari - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Global Coal Blending Company Limited - Australia
- Kumho Petrochemical, South Korea
- GVK Power & Infra Limited - India
- Bhoruka Overseas - Indonesia
- Binh Thuan Hamico - Vietnam
- Tamil Nadu electricity Board
- Semirara Mining Corp, Philippines
- CNBM International Corporation - China
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- The Treasury - Australian Government
- VISA Power Limited - India
- Star Paper Mills Limited - India
- Central Java Power - Indonesia
- Rio Tinto Coal - Australia
- Latin American Coal - Colombia
- LBH Netherlands Bv - Netherlands
- Madhucon Powers Ltd - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Trasteel International SA, Italy
- Banpu Public Company Limited - Thailand
- ASAPP Information Group - India
- Carbofer General Trading SA - India
- Aditya Birla Group - India
- Sree Jayajothi Cements Limited - India
- Commonwealth Bank - Australia
- Vizag Seaport Private Limited - India
- Chamber of Mines of South Africa
- Bukit Asam (Persero) Tbk - Indonesia
- Videocon Industries ltd - India
- Meralco Power Generation, Philippines
- Indogreen Group - Indonesia
- Power Finance Corporation Ltd., India
- Goldman Sachs - Singapore
- Siam City Cement - Thailand
- Energy Development Corp, Philippines
- McConnell Dowell - Australia
- Sarangani Energy Corporation, Philippines
- Timah Investasi Mineral - Indoneisa
- Sical Logistics Limited - India
- Tata Chemicals Ltd - India
- Billiton Holdings Pty Ltd - Australia
- Eastern Energy - Thailand
- Straits Asia Resources Limited - Singapore
- Global Business Power Corporation, Philippines
- Metalloyd Limited - United Kingdom
- India Bulls Power Limited - India
- Planning Commission, India
- Indo Tambangraya Megah - Indonesia
- Bhushan Steel Limited - India
- Jorong Barutama Greston.PT - Indonesia
- PowerSource Philippines DevCo
- PTC India Limited - India
- Orica Australia Pty. Ltd.
- Savvy Resources Ltd - HongKong
- Gujarat Mineral Development Corp Ltd - India
- Interocean Group of Companies - India
- Cigading International Bulk Terminal - Indonesia
- Essar Steel Hazira Ltd - India
- Bahari Cakrawala Sebuku - Indonesia
- Malabar Cements Ltd - India
- Bharathi Cement Corporation - India
- Jindal Steel & Power Ltd - India
- Bukit Baiduri Energy - Indonesia
- Renaissance Capital - South Africa
- Riau Bara Harum - Indonesia
- Vedanta Resources Plc - India
- Parliament of New Zealand
- Offshore Bulk Terminal Pte Ltd, Singapore
- Lanco Infratech Ltd - India
- Ambuja Cements Ltd - India
- Larsen & Toubro Limited - India
- GMR Energy Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Kohat Cement Company Ltd. - Pakistan
- Borneo Indobara - Indonesia
- Ministry of Mines - Canada
- Global Green Power PLC Corporation, Philippines
- Mercator Lines Limited - India
- Dalmia Cement Bharat India
- Toyota Tsusho Corporation, Japan
- Neyveli Lignite Corporation Ltd, - India
- Agrawal Coal Company - India
- Rashtriya Ispat Nigam Limited - India
- Merrill Lynch Commodities Europe
- PetroVietnam Power Coal Import and Supply Company
- Cement Manufacturers Association - India
- Indonesian Coal Mining Association
- TeaM Sual Corporation - Philippines
- Meenaskhi Energy Private Limited - India
- Chettinad Cement Corporation Ltd - India
- Electricity Generating Authority of Thailand
- Bayan Resources Tbk. - Indonesia
- Parry Sugars Refinery, India
- CIMB Investment Bank - Malaysia
- Indian Oil Corporation Limited
- Kapuas Tunggal Persada - Indonesia
- The University of Queensland
- SMC Global Power, Philippines
- IHS Mccloskey Coal Group - USA
- Salva Resources Pvt Ltd - India
- Sinarmas Energy and Mining - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Kobexindo Tractors - Indoneisa
- Independent Power Producers Association of India
- Kalimantan Lumbung Energi - Indonesia
- Xindia Steels Limited - India
- Aboitiz Power Corporation - Philippines
- IEA Clean Coal Centre - UK
- Port Waratah Coal Services - Australia
- Maharashtra Electricity Regulatory Commission - India
- White Energy Company Limited
- Heidelberg Cement - Germany
- London Commodity Brokers - England
- Bulk Trading Sa - Switzerland
- Indika Energy - Indonesia
- Kideco Jaya Agung - Indonesia
- Energy Link Ltd, New Zealand
- TNB Fuel Sdn Bhd - Malaysia
- Iligan Light & Power Inc, Philippines
- Ceylon Electricity Board - Sri Lanka
- ICICI Bank Limited - India
- The State Trading Corporation of India Ltd
- Deloitte Consulting - India
- Jaiprakash Power Ventures ltd
- Indian Energy Exchange, India
- Sakthi Sugars Limited - India
- Anglo American - United Kingdom
- Economic Council, Georgia
- AsiaOL BioFuels Corp., Philippines
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