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Friday, 20 March 20
VOLATILITY TO INCREASE IN TANKER MARKET FOLLOWING OIL PRICE WAR - DREWRY
Crude oil prices plunged by more than a third in the past week after OPEC+ failed to agree on production cut as demand softened in the aftermath of coronavirus (COVID-19). In its recent report, the IEA estimates global oil demand at 99.9 mbpd in 2020, which is around 90,000 bpd lower than in 2019 and a sharp downgrade from the agency’s forecast in February, which predicted global oil demand will grow 825,000 bpd in 2020.
The market expected OPEC+ to cut supply as the COVID-19 epidemic has spread from China to Europe, the Americas and Middle East. However, the negotiations failed due to strong resistance from Russia, which is of the view that the policy of capping production by OPEC+ producers to support the oil price is facilitating the development of US shale oil, with Russia losing its market share to increasing exports from the US.
After the failure of production cut talks in Vienna, Saudi Arabia started a price war by slashing the official selling prices for crude for key buyers in the international market and hinted at raising crude oil production to full capacity of 12.3 mbpd from April 2020. The ‘shock and awe’ tactics of Saudi Arabia could be a move to impose maximum pain in the quickest possible way to Russia and other producers, in an effort to renegotiate the proposed production cut and then quickly reverse the production surge and thereafter implement the production cut if a deal is reached.
However, the recent move by Saudi Arabia could lead to:
a) Renegotiation on a production cut between OPEC and Russia
b) Prolonged price war between OPEC, Russia and US producers
If there are fresh negotiations to implement a production cut by OPEC+ producers to accommodate the effect of declining oil demand, crude oil prices are expected to normalise.
But if there is a prolonged price war between Saudi Arabia, Russia and US shale oil producers, lower crude oil prices will lead to some improvement in global oil demand and refinery runs. At the same time, onshore stocking activity will also increase, especially in countries such as China as they build their Strategic Petroleum Reserve. A global supply glut is also likely to lead to an increase in floating storage especially among oil producers.
At the same time, sustained weakness in oil prices will eventually hurt US shale oil producers because of their relatively higher cost of production. In such circumstances, the market share of Middle Eastern crude will increase at the expense of US crude.
Meanwhile, tanker rates surged due to a sudden increase in VLCC chartering from Bahri, Saudi Arabia’s national shipping arm. Bahri fixed at least 18 VLCCs since the Kingdom aims to pump more crude into the market as its price war with Russia escalates. The VLCC earnings on Middle East–China (TD3C) route skyrocketed to $166,000pd on 11 March from $30,300pd on 06 March.
If Saudi Arabia manages to strike a deal with Russia to cut production in the short term, tanker rates will plummet to the pre-price war levels because of the ongoing weakness in crude oil trade on account of the spread of COVID-19 globally. On the other hand, if there is a prolonged price war, tonnage demand will rise initially with the increase in oil demand and stocking activity, which in turn will keep freight rates above pre-price war levels.
However, once sustained weakness in oil prices starts hurting US crude production, Middle Eastern crude will start displacing US crude in Asia. This in turn will squeeze tonne-mile demand for tankers as the distance between the US to Asia is almost double the distance between the Middle East to Asia. Thus we estimate that every barrel per day of annual decline in US exports to Asia at the expense of the Middle East will lead to about a 2.5% decline in overall tonne-mile demand for tankers. Freight rates in such a situation will plunge below the pre-price war levels.
Source: Drewry
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Tuesday, 07 April 20
IS CHINA EMBARKING ON A MAJOR EXPANSION OF COAL-FIRED POWER GENERATION? - WOOD MACKENZIE
As energy companies worldwide grapple with the economic impact of the coronavirus pandemic, long-term planning continues. Ahead of the release of t ...
Tuesday, 07 April 20
COAL INDIA'S DISPATCHES DROP, OUTPUT INCREASES - THE HINDU
India’s largest coal producer Coal India Ltd. (CIL) has seen a 10% fall in dispatches in March 2020 due to a sharp fall in demand from the po ...
Tuesday, 07 April 20
CORONAVIRUS AND LOCKDOWNS DRAG DOWN THE INDONESIAN COAL PRICE REFERENCE IN APRIL
COALspot.com: The Ministry of Energy and Mineral Resources of the Republic of Indonesia has revised down the benchmark price of the Indonesian ther ...
Monday, 06 April 20
A 52,000DWT SHIP FIXING DELIVERY SINGAPORE TRIP, VIA INDONESIA, REDELIVERY TAIWAN, AT $3,100 - BALTIC BRIEFING
Capesize
The Capesize market this past week looks to have come off life support and found some improved sentiment. The week began rather ordina ...
Monday, 06 April 20
INDIA'S 21-DAY LOCKDOWN - IMPACT ON COMMODITIES? - WOOD MACKENZIE
India is under a three-week lockdown from 25 March, to contain the spread of the coronavirus outbreak. Wood Mackenzie analysts discuss what this me ...
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Showing 1026 to 1030 news of total 6871 |
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- Aboitiz Power Corporation - Philippines
- Orica Australia Pty. Ltd.
- Bukit Baiduri Energy - Indonesia
- Kideco Jaya Agung - Indonesia
- Sakthi Sugars Limited - India
- MS Steel International - UAE
- Sojitz Corporation - Japan
- Coal and Oil Company - UAE
- Holcim Trading Pte Ltd - Singapore
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Videocon Industries ltd - India
- Indian Energy Exchange, India
- Sarangani Energy Corporation, Philippines
- Independent Power Producers Association of India
- Australian Commodity Traders Exchange
- Kepco SPC Power Corporation, Philippines
- Riau Bara Harum - Indonesia
- Aditya Birla Group - India
- Siam City Cement - Thailand
- Grasim Industreis Ltd - India
- Ministry of Mines - Canada
- Jaiprakash Power Ventures ltd
- OPG Power Generation Pvt Ltd - India
- CNBM International Corporation - China
- SN Aboitiz Power Inc, Philippines
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Toyota Tsusho Corporation, Japan
- Kartika Selabumi Mining - Indonesia
- GMR Energy Limited - India
- Carbofer General Trading SA - India
- European Bulk Services B.V. - Netherlands
- Coalindo Energy - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Karaikal Port Pvt Ltd - India
- Makarim & Taira - Indonesia
- Uttam Galva Steels Limited - India
- Electricity Generating Authority of Thailand
- Salva Resources Pvt Ltd - India
- Mjunction Services Limited - India
- Anglo American - United Kingdom
- Leighton Contractors Pty Ltd - Australia
- Sindya Power Generating Company Private Ltd
- TNB Fuel Sdn Bhd - Malaysia
- IEA Clean Coal Centre - UK
- White Energy Company Limited
- Metalloyd Limited - United Kingdom
- Wilmar Investment Holdings
- The State Trading Corporation of India Ltd
- Jindal Steel & Power Ltd - India
- Global Coal Blending Company Limited - Australia
- GVK Power & Infra Limited - India
- Latin American Coal - Colombia
- Kalimantan Lumbung Energi - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Lanco Infratech Ltd - India
- India Bulls Power Limited - India
- Directorate Of Revenue Intelligence - India
- Banpu Public Company Limited - Thailand
- Ind-Barath Power Infra Limited - India
- Vizag Seaport Private Limited - India
- Pendopo Energi Batubara - Indonesia
- Billiton Holdings Pty Ltd - Australia
- PetroVietnam Power Coal Import and Supply Company
- Ambuja Cements Ltd - India
- Renaissance Capital - South Africa
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Eastern Coal Council - USA
- GAC Shipping (India) Pvt Ltd
- Medco Energi Mining Internasional
- The Treasury - Australian Government
- Siam City Cement PLC, Thailand
- Formosa Plastics Group - Taiwan
- McConnell Dowell - Australia
- Parliament of New Zealand
- Dalmia Cement Bharat India
- SMG Consultants - Indonesia
- Binh Thuan Hamico - Vietnam
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- London Commodity Brokers - England
- Africa Commodities Group - South Africa
- Globalindo Alam Lestari - Indonesia
- Savvy Resources Ltd - HongKong
- Timah Investasi Mineral - Indoneisa
- Posco Energy - South Korea
- Global Business Power Corporation, Philippines
- Tata Chemicals Ltd - India
- Bulk Trading Sa - Switzerland
- Intertek Mineral Services - Indonesia
- Sical Logistics Limited - India
- ICICI Bank Limited - India
- Larsen & Toubro Limited - India
- Indonesian Coal Mining Association
- Energy Development Corp, Philippines
- Semirara Mining Corp, Philippines
- Coastal Gujarat Power Limited - India
- TeaM Sual Corporation - Philippines
- The University of Queensland
- Rio Tinto Coal - Australia
- Cement Manufacturers Association - India
- VISA Power Limited - India
- South Luzon Thermal Energy Corporation
- Interocean Group of Companies - India
- GN Power Mariveles Coal Plant, Philippines
- Meenaskhi Energy Private Limited - India
- PNOC Exploration Corporation - Philippines
- Iligan Light & Power Inc, Philippines
- Australian Coal Association
- LBH Netherlands Bv - Netherlands
- Thai Mozambique Logistica
- Pipit Mutiara Jaya. PT, Indonesia
- Ministry of Finance - Indonesia
- Kaltim Prima Coal - Indonesia
- Gujarat Sidhee Cement - India
- Singapore Mercantile Exchange
- Bukit Asam (Persero) Tbk - Indonesia
- Kumho Petrochemical, South Korea
- Commonwealth Bank - Australia
- New Zealand Coal & Carbon
- Indika Energy - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Bhatia International Limited - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Maharashtra Electricity Regulatory Commission - India
- Bayan Resources Tbk. - Indonesia
- Indo Tambangraya Megah - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- Thiess Contractors Indonesia
- Baramulti Group, Indonesia
- Meralco Power Generation, Philippines
- Energy Link Ltd, New Zealand
- Alfred C Toepfer International GmbH - Germany
- Mercuria Energy - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Straits Asia Resources Limited - Singapore
- Price Waterhouse Coopers - Russia
- Borneo Indobara - Indonesia
- Essar Steel Hazira Ltd - India
- Therma Luzon, Inc, Philippines
- Sinarmas Energy and Mining - Indonesia
- Bharathi Cement Corporation - India
- Asmin Koalindo Tuhup - Indonesia
- Parry Sugars Refinery, India
- Maheswari Brothers Coal Limited - India
- CIMB Investment Bank - Malaysia
- Altura Mining Limited, Indonesia
- Antam Resourcindo - Indonesia
- PTC India Limited - India
- Barasentosa Lestari - Indonesia
- Wood Mackenzie - Singapore
- Minerals Council of Australia
- Central Electricity Authority - India
- Agrawal Coal Company - India
- SMC Global Power, Philippines
- Petron Corporation, Philippines
- IHS Mccloskey Coal Group - USA
- Edison Trading Spa - Italy
- Mercator Lines Limited - India
- Eastern Energy - Thailand
- Chamber of Mines of South Africa
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Romanian Commodities Exchange
- Global Green Power PLC Corporation, Philippines
- Gujarat Mineral Development Corp Ltd - India
- Trasteel International SA, Italy
- Bangladesh Power Developement Board
- International Coal Ventures Pvt Ltd - India
- Attock Cement Pakistan Limited
- Chettinad Cement Corporation Ltd - India
- Bukit Makmur.PT - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Oldendorff Carriers - Singapore
- Port Waratah Coal Services - Australia
- Xindia Steels Limited - India
- Marubeni Corporation - India
- Malabar Cements Ltd - India
- Bhushan Steel Limited - India
- Manunggal Multi Energi - Indonesia
- Central Java Power - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Ministry of Transport, Egypt
- Planning Commission, India
- Directorate General of MIneral and Coal - Indonesia
- San Jose City I Power Corp, Philippines
- Kobexindo Tractors - Indoneisa
- Electricity Authority, New Zealand
- Offshore Bulk Terminal Pte Ltd, Singapore
- Jorong Barutama Greston.PT - Indonesia
- Deloitte Consulting - India
- Rashtriya Ispat Nigam Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Goldman Sachs - Singapore
- Orica Mining Services - Indonesia
- Indogreen Group - Indonesia
- Vedanta Resources Plc - India
- Economic Council, Georgia
- Bhoruka Overseas - Indonesia
- ASAPP Information Group - India
- Heidelberg Cement - Germany
- Karbindo Abesyapradhi - Indoneisa
- AsiaOL BioFuels Corp., Philippines
- Star Paper Mills Limited - India
- Miang Besar Coal Terminal - Indonesia
- Georgia Ports Authority, United States
- Simpson Spence & Young - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Kohat Cement Company Ltd. - Pakistan
- PowerSource Philippines DevCo
- Kapuas Tunggal Persada - Indonesia
- Madhucon Powers Ltd - India
- Samtan Co., Ltd - South Korea
- Merrill Lynch Commodities Europe
- Sree Jayajothi Cements Limited - India
- Mintek Dendrill Indonesia
- Indian Oil Corporation Limited
- Tamil Nadu electricity Board
- Power Finance Corporation Ltd., India
- Standard Chartered Bank - UAE
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