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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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- Economic Council, Georgia
- Trasteel International SA, Italy
- Global Green Power PLC Corporation, Philippines
- Parliament of New Zealand
- Indian Oil Corporation Limited
- Semirara Mining and Power Corporation, Philippines
- Bank of Tokyo Mitsubishi UFJ Ltd
- Bulk Trading Sa - Switzerland
- IHS Mccloskey Coal Group - USA
- Price Waterhouse Coopers - Russia
- Sinarmas Energy and Mining - Indonesia
- Bhoruka Overseas - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Australian Commodity Traders Exchange
- Mjunction Services Limited - India
- Simpson Spence & Young - Indonesia
- Bukit Makmur.PT - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Parry Sugars Refinery, India
- Anglo American - United Kingdom
- Gujarat Electricity Regulatory Commission - India
- Energy Link Ltd, New Zealand
- Straits Asia Resources Limited - Singapore
- Indian Energy Exchange, India
- ASAPP Information Group - India
- Kideco Jaya Agung - Indonesia
- Vedanta Resources Plc - India
- Miang Besar Coal Terminal - Indonesia
- Deloitte Consulting - India
- GAC Shipping (India) Pvt Ltd
- Videocon Industries ltd - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- AsiaOL BioFuels Corp., Philippines
- Savvy Resources Ltd - HongKong
- Barasentosa Lestari - Indonesia
- Latin American Coal - Colombia
- Bharathi Cement Corporation - India
- Global Business Power Corporation, Philippines
- The Treasury - Australian Government
- PTC India Limited - India
- Meenaskhi Energy Private Limited - India
- Borneo Indobara - Indonesia
- Star Paper Mills Limited - India
- Lanco Infratech Ltd - India
- India Bulls Power Limited - India
- Heidelberg Cement - Germany
- Mintek Dendrill Indonesia
- Dalmia Cement Bharat India
- Riau Bara Harum - Indonesia
- PNOC Exploration Corporation - Philippines
- Bahari Cakrawala Sebuku - Indonesia
- Merrill Lynch Commodities Europe
- Asmin Koalindo Tuhup - Indonesia
- Ceylon Electricity Board - Sri Lanka
- Neyveli Lignite Corporation Ltd, - India
- Grasim Industreis Ltd - India
- London Commodity Brokers - England
- Karaikal Port Pvt Ltd - India
- Central Java Power - Indonesia
- The University of Queensland
- Maharashtra Electricity Regulatory Commission - India
- Thai Mozambique Logistica
- Directorate Of Revenue Intelligence - India
- MS Steel International - UAE
- OPG Power Generation Pvt Ltd - India
- Bhushan Steel Limited - India
- Bhatia International Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Minerals Council of Australia
- Interocean Group of Companies - India
- Port Waratah Coal Services - Australia
- Vizag Seaport Private Limited - India
- VISA Power Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- Posco Energy - South Korea
- Wilmar Investment Holdings
- New Zealand Coal & Carbon
- Mercuria Energy - Indonesia
- Maheswari Brothers Coal Limited - India
- Electricity Generating Authority of Thailand
- Commonwealth Bank - Australia
- Attock Cement Pakistan Limited
- Tamil Nadu electricity Board
- Sree Jayajothi Cements Limited - India
- Binh Thuan Hamico - Vietnam
- Meralco Power Generation, Philippines
- Eastern Energy - Thailand
- Aditya Birla Group - India
- IEA Clean Coal Centre - UK
- Larsen & Toubro Limited - India
- GMR Energy Limited - India
- International Coal Ventures Pvt Ltd - India
- Eastern Coal Council - USA
- Kartika Selabumi Mining - Indonesia
- LBH Netherlands Bv - Netherlands
- Jorong Barutama Greston.PT - Indonesia
- Sakthi Sugars Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- GN Power Mariveles Coal Plant, Philippines
- Formosa Plastics Group - Taiwan
- Kalimantan Lumbung Energi - Indonesia
- Metalloyd Limited - United Kingdom
- Cigading International Bulk Terminal - Indonesia
- San Jose City I Power Corp, Philippines
- Sarangani Energy Corporation, Philippines
- Power Finance Corporation Ltd., India
- Jindal Steel & Power Ltd - India
- CIMB Investment Bank - Malaysia
- Gujarat Mineral Development Corp Ltd - India
- Uttam Galva Steels Limited - India
- Holcim Trading Pte Ltd - Singapore
- TeaM Sual Corporation - Philippines
- Siam City Cement PLC, Thailand
- South Luzon Thermal Energy Corporation
- Pendopo Energi Batubara - Indonesia
- Sical Logistics Limited - India
- Timah Investasi Mineral - Indoneisa
- Renaissance Capital - South Africa
- Xindia Steels Limited - India
- Rio Tinto Coal - Australia
- Billiton Holdings Pty Ltd - Australia
- Petrochimia International Co. Ltd.- Taiwan
- Antam Resourcindo - Indonesia
- Energy Development Corp, Philippines
- Indika Energy - Indonesia
- Cement Manufacturers Association - India
- SN Aboitiz Power Inc, Philippines
- Malabar Cements Ltd - India
- Kumho Petrochemical, South Korea
- PetroVietnam Power Coal Import and Supply Company
- Bangladesh Power Developement Board
- TNB Fuel Sdn Bhd - Malaysia
- European Bulk Services B.V. - Netherlands
- Kohat Cement Company Ltd. - Pakistan
- The State Trading Corporation of India Ltd
- Therma Luzon, Inc, Philippines
- Gujarat Sidhee Cement - India
- Planning Commission, India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Medco Energi Mining Internasional
- Indo Tambangraya Megah - Indonesia
- Ind-Barath Power Infra Limited - India
- Essar Steel Hazira Ltd - India
- Thiess Contractors Indonesia
- Aboitiz Power Corporation - Philippines
- Tata Chemicals Ltd - India
- Global Coal Blending Company Limited - Australia
- Ministry of Transport, Egypt
- Iligan Light & Power Inc, Philippines
- Offshore Bulk Terminal Pte Ltd, Singapore
- Sindya Power Generating Company Private Ltd
- GVK Power & Infra Limited - India
- Georgia Ports Authority, United States
- Toyota Tsusho Corporation, Japan
- Globalindo Alam Lestari - Indonesia
- Coastal Gujarat Power Limited - India
- Edison Trading Spa - Italy
- Madhucon Powers Ltd - India
- Kobexindo Tractors - Indoneisa
- Indogreen Group - Indonesia
- Central Electricity Authority - India
- Manunggal Multi Energi - Indonesia
- White Energy Company Limited
- Bukit Baiduri Energy - Indonesia
- Electricity Authority, New Zealand
- Carbofer General Trading SA - India
- CNBM International Corporation - China
- Africa Commodities Group - South Africa
- Ministry of Finance - Indonesia
- SMG Consultants - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Ministry of Mines - Canada
- Wood Mackenzie - Singapore
- Independent Power Producers Association of India
- Siam City Cement - Thailand
- ICICI Bank Limited - India
- Jaiprakash Power Ventures ltd
- Intertek Mineral Services - Indonesia
- Mercator Lines Limited - India
- Salva Resources Pvt Ltd - India
- Agrawal Coal Company - India
- Indonesian Coal Mining Association
- Ambuja Cements Ltd - India
- Singapore Mercantile Exchange
- Orica Australia Pty. Ltd.
- Kaltim Prima Coal - Indonesia
- Baramulti Group, Indonesia
- McConnell Dowell - Australia
- Sojitz Corporation - Japan
- SMC Global Power, Philippines
- PowerSource Philippines DevCo
- Coalindo Energy - Indonesia
- Marubeni Corporation - India
- Oldendorff Carriers - Singapore
- Leighton Contractors Pty Ltd - Australia
- Coal and Oil Company - UAE
- Romanian Commodities Exchange
- Chamber of Mines of South Africa
- Kepco SPC Power Corporation, Philippines
- Semirara Mining Corp, Philippines
- Samtan Co., Ltd - South Korea
- Makarim & Taira - Indonesia
- Orica Mining Services - Indonesia
- Bayan Resources Tbk. - Indonesia
- Chettinad Cement Corporation Ltd - India
- Altura Mining Limited, Indonesia
- Goldman Sachs - Singapore
- Petron Corporation, Philippines
- Australian Coal Association
- Standard Chartered Bank - UAE
- Rashtriya Ispat Nigam Limited - India
- Banpu Public Company Limited - Thailand
- Kapuas Tunggal Persada - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Vijayanagar Sugar Pvt Ltd - India
- Bukit Asam (Persero) Tbk - Indonesia
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