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Friday, 17 April 20
SAUDI ARABIA'S MAY 2020 OSPS FOR CRUDE EXPORTS BODE WELL FOR ASIAN REFINERS - WOOD MACKENZIE
 On 13 April, Saudi Arabia announced the Official Selling Prices (OSPs) for its May crude oil exports. The new OSPs speak volumes about Saudi Arabia’s crude export strategy after agreeing to cut production in the OPEC+ deal on 10 April 2020.
Wood Mackenzie research director Sushant Gupta said: “Looking at the May OSPs, it is clear that Saudi Arabia wants to ensure its crude remains very competitive in Asia. It has almost doubled the discounts to Asian refiners in May 2020 compared to April 2020. Asian refiners are to enjoy the steepest discounts compared to other regions.”
Saudi Arabia increased the May 2020 OSPs to the US refiners, indicating a desire to export lower volumes to the US. For Saudi Arabia, these volumes are less lucrative.
For Europe and the Mediterranean, the OSPs are maintained, continuing the pressure on Russian Urals’ pricing towards Europe.
Crude runs in Asia are expected to recover from a low point of 26 million barrels per day (b/d) in April 2020 to about 29 million b/d by June 2020, as a result of an expected recovery in oil demand. At the same time, with OPEC+ production cuts likely fully in place by June 2020, crude markets in Asia could also get tighter.
Gupta said: “To meet the entire demand from the refining system, Asian refiners will need to draw down crude inventories built through H1 2020 in their respective countries, and crude producers will have to rely on selling crude from inventories built through April 2020. This will support crude prices.
“We see large changes to crude supply sources for Asian refiners as they rely heavily on crude producers directly impacted by the OPEC+ deal, such as Saudi Arabia, Iraq, Kuwait, the UAE, Angola, Nigeria and Russia. Asia represents a significant share of the exports from these countries.
“No doubt exports to Asia from Saudi Arabia and Russia will be impacted, but because Asia provides a higher netback to both Russia and Saudi Arabia, both will ensure that Asian market volumes fall the least as they cut output. We would expect both producers to divert volumes towards Asia from other regions.
“The discounted OSPs does not continue the price war, rather it is a necessary step to protect Saudi Arabia’s largest and most profitable export market, Asia. With such steep discounts in May 2020, Saudi grades look very attractive to Asian refiners compared to US WTI and key African crude grades.”
Wood Mackenzie expects the light-heavy crude differential to narrow as medium and heavy crude production is preferentially cut as part of OPEC+ deal. Steeper discounts for Saudi grades are a means to compensate refiners for a narrower light-heavy differential.
The deepening OSP discounts would also be required to account for a softening VLCC freight rates driven by OPEC+ production cuts. A lower VLCC freight rate improves relative economics for long-haul shipments such as US WTI crude and Nigeria Bonny Light crude to Asia compared to crudes from the Middle East.
Gupta said: “With deeper discounts to Asia, Saudi Arabia is ensuring that it does not lose access to buyers if oil demand remains weak. Other suppliers looking to position themselves in Asia will have to pay close attention to the Saudis’ pricing.
“ESPO crude from Russia would require a deeper discount to Dubai benchmark to remain competitive against Saudi Arabian crudes. US and African crude grades also would need to be further discounted to compete into Asia.”
Source: Wood Mackenzie
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Wednesday, 06 May 20
KOSPO INVITED COAL BIDS FOR LOW CALORIFIC VALUE COAL
COALspot.com: Korea Southern Power Co., Ltd. (KOSPO) has issued an International tender for 160,000 Metric Tons (MT) Low Calorific Value Coal for J ...
Wednesday, 06 May 20
COST CHALLENGES IN A US$20/BBL WORLD - WOOD MACKENZIE
A new approach is needed to ensure supply sector resilience
How will US$20/bbl affect the oil and gas supply chain?
It’s going to g ...
Wednesday, 06 May 20
MARKET INSIGHT - INTERMODAL
It comes as no surprise that activity in the dry bulk SnP market remains soft, with asset values caught in the downward spiral generated by the Cov ...
Wednesday, 06 May 20
FLOATING STORAGE OF OIL CARGOES - STANDARD CLUB
KNOWLEDGE TO ELEVATE
Due to a combination of circumstances there is now a worldwide shortage of storage space ashore for both unrefi ...
Wednesday, 06 May 20
IRON ORE TRADE REMAINS REMARKABLY RESILIENT THIS YEAR, AT LEAST IN ASIA - BANCHERO COSTA
Iron ore trade remains remarkably resilient this year, at least in Asia, despite the global economic impact from COVID-19. In the first 4 months of ...
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- Africa Commodities Group - South Africa
- GMR Energy Limited - India
- Posco Energy - South Korea
- International Coal Ventures Pvt Ltd - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Renaissance Capital - South Africa
- Heidelberg Cement - Germany
- Chamber of Mines of South Africa
- Ind-Barath Power Infra Limited - India
- Borneo Indobara - Indonesia
- Eastern Energy - Thailand
- Lanco Infratech Ltd - India
- Thiess Contractors Indonesia
- Sindya Power Generating Company Private Ltd
- Kartika Selabumi Mining - Indonesia
- ASAPP Information Group - India
- Kaltim Prima Coal - Indonesia
- Marubeni Corporation - India
- Banpu Public Company Limited - Thailand
- Parry Sugars Refinery, India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Siam City Cement PLC, Thailand
- Independent Power Producers Association of India
- The University of Queensland
- Energy Link Ltd, New Zealand
- Wilmar Investment Holdings
- Meralco Power Generation, Philippines
- Altura Mining Limited, Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Orica Australia Pty. Ltd.
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Gujarat Sidhee Cement - India
- Gujarat Electricity Regulatory Commission - India
- Rio Tinto Coal - Australia
- San Jose City I Power Corp, Philippines
- Aditya Birla Group - India
- Energy Development Corp, Philippines
- Bukit Baiduri Energy - Indonesia
- Interocean Group of Companies - India
- Sree Jayajothi Cements Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- Orica Mining Services - Indonesia
- PowerSource Philippines DevCo
- Planning Commission, India
- Ceylon Electricity Board - Sri Lanka
- LBH Netherlands Bv - Netherlands
- London Commodity Brokers - England
- Commonwealth Bank - Australia
- Kideco Jaya Agung - Indonesia
- ICICI Bank Limited - India
- The Treasury - Australian Government
- Latin American Coal - Colombia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- PNOC Exploration Corporation - Philippines
- Asmin Koalindo Tuhup - Indonesia
- Aboitiz Power Corporation - Philippines
- Metalloyd Limited - United Kingdom
- Vedanta Resources Plc - India
- New Zealand Coal & Carbon
- Globalindo Alam Lestari - Indonesia
- Attock Cement Pakistan Limited
- Sakthi Sugars Limited - India
- Miang Besar Coal Terminal - Indonesia
- GVK Power & Infra Limited - India
- Standard Chartered Bank - UAE
- SMG Consultants - Indonesia
- Therma Luzon, Inc, Philippines
- Kohat Cement Company Ltd. - Pakistan
- Simpson Spence & Young - Indonesia
- Jindal Steel & Power Ltd - India
- Medco Energi Mining Internasional
- Agrawal Coal Company - India
- Vizag Seaport Private Limited - India
- Holcim Trading Pte Ltd - Singapore
- Romanian Commodities Exchange
- GAC Shipping (India) Pvt Ltd
- Goldman Sachs - Singapore
- SMC Global Power, Philippines
- Rashtriya Ispat Nigam Limited - India
- Dalmia Cement Bharat India
- Electricity Generating Authority of Thailand
- Makarim & Taira - Indonesia
- Iligan Light & Power Inc, Philippines
- IHS Mccloskey Coal Group - USA
- Antam Resourcindo - Indonesia
- Indonesian Coal Mining Association
- Electricity Authority, New Zealand
- Bangladesh Power Developement Board
- Toyota Tsusho Corporation, Japan
- PetroVietnam Power Coal Import and Supply Company
- Sinarmas Energy and Mining - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Larsen & Toubro Limited - India
- Bukit Makmur.PT - Indonesia
- Wood Mackenzie - Singapore
- Straits Asia Resources Limited - Singapore
- Directorate Of Revenue Intelligence - India
- Sarangani Energy Corporation, Philippines
- Savvy Resources Ltd - HongKong
- OPG Power Generation Pvt Ltd - India
- TNB Fuel Sdn Bhd - Malaysia
- Sical Logistics Limited - India
- Kepco SPC Power Corporation, Philippines
- AsiaOL BioFuels Corp., Philippines
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Videocon Industries ltd - India
- Chettinad Cement Corporation Ltd - India
- Bhushan Steel Limited - India
- Mercuria Energy - Indonesia
- Jaiprakash Power Ventures ltd
- Krishnapatnam Port Company Ltd. - India
- Kobexindo Tractors - Indoneisa
- McConnell Dowell - Australia
- Bhatia International Limited - India
- SN Aboitiz Power Inc, Philippines
- Coal and Oil Company - UAE
- Jorong Barutama Greston.PT - Indonesia
- European Bulk Services B.V. - Netherlands
- Petrochimia International Co. Ltd.- Taiwan
- Ministry of Mines - Canada
- Meenaskhi Energy Private Limited - India
- Carbofer General Trading SA - India
- Kumho Petrochemical, South Korea
- MS Steel International - UAE
- Pendopo Energi Batubara - Indonesia
- Central Electricity Authority - India
- Karaikal Port Pvt Ltd - India
- VISA Power Limited - India
- CIMB Investment Bank - Malaysia
- CNBM International Corporation - China
- Georgia Ports Authority, United States
- Malabar Cements Ltd - India
- Petron Corporation, Philippines
- Binh Thuan Hamico - Vietnam
- TeaM Sual Corporation - Philippines
- Deloitte Consulting - India
- Indo Tambangraya Megah - Indonesia
- Indian Oil Corporation Limited
- Bulk Trading Sa - Switzerland
- South Luzon Thermal Energy Corporation
- Alfred C Toepfer International GmbH - Germany
- Semirara Mining Corp, Philippines
- Indika Energy - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Ministry of Transport, Egypt
- Sojitz Corporation - Japan
- Price Waterhouse Coopers - Russia
- Uttam Galva Steels Limited - India
- Power Finance Corporation Ltd., India
- Anglo American - United Kingdom
- PTC India Limited - India
- Siam City Cement - Thailand
- Star Paper Mills Limited - India
- Gujarat Mineral Development Corp Ltd - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Samtan Co., Ltd - South Korea
- Economic Council, Georgia
- Trasteel International SA, Italy
- Manunggal Multi Energi - Indonesia
- Global Business Power Corporation, Philippines
- Parliament of New Zealand
- Thai Mozambique Logistica
- Xindia Steels Limited - India
- Cement Manufacturers Association - India
- Global Green Power PLC Corporation, Philippines
- Oldendorff Carriers - Singapore
- Indian Energy Exchange, India
- The State Trading Corporation of India Ltd
- Ministry of Finance - Indonesia
- Merrill Lynch Commodities Europe
- Australian Commodity Traders Exchange
- Australian Coal Association
- Central Java Power - Indonesia
- Grasim Industreis Ltd - India
- Edison Trading Spa - Italy
- Neyveli Lignite Corporation Ltd, - India
- Directorate General of MIneral and Coal - Indonesia
- Global Coal Blending Company Limited - Australia
- Leighton Contractors Pty Ltd - Australia
- Eastern Coal Council - USA
- Formosa Plastics Group - Taiwan
- Minerals Council of Australia
- Essar Steel Hazira Ltd - India
- Madhucon Powers Ltd - India
- Bhoruka Overseas - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Salva Resources Pvt Ltd - India
- Mjunction Services Limited - India
- Tamil Nadu electricity Board
- Maheswari Brothers Coal Limited - India
- Kalimantan Lumbung Energi - Indonesia
- Coastal Gujarat Power Limited - India
- Riau Bara Harum - Indonesia
- Tata Chemicals Ltd - India
- Barasentosa Lestari - Indonesia
- India Bulls Power Limited - India
- Coalindo Energy - Indonesia
- White Energy Company Limited
- Semirara Mining and Power Corporation, Philippines
- Bahari Cakrawala Sebuku - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Singapore Mercantile Exchange
- Baramulti Group, Indonesia
- Port Waratah Coal Services - Australia
- Timah Investasi Mineral - Indoneisa
- Mercator Lines Limited - India
- Bharathi Cement Corporation - India
- IEA Clean Coal Centre - UK
- Mintek Dendrill Indonesia
- Ambuja Cements Ltd - India
- Karbindo Abesyapradhi - Indoneisa
- Intertek Mineral Services - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Maharashtra Electricity Regulatory Commission - India
- Kapuas Tunggal Persada - Indonesia
- Indogreen Group - Indonesia
- Bayan Resources Tbk. - Indonesia
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