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Friday, 17 April 20
OPEC BRACES FOR OIL MARKET'S "HISTORIC SHOCK"
 OPEC released its much anticipated April monthly report.
Crude Oil Price Movements
Crude oil prices collapsed in March 2020, recording their deepest monthly drop since the global financial crisis in 2008. The ramifications of the COVID-19 pandemic were the main driving force, resulting in unprecedented worldwide oil demand shock and massive sell-offs in the global oil markets, amid a significant crude surplus. The OPEC Reference Basket (ORB) value was down by $21.61, or 38.9%, m-o-m, to stand at $33.92/b, the lowest monthly value since September 2003. ICE Brent declined by $21.75, or 39.2%, m-o-m, to average $33.73/b, while NYMEX WTI fell $20.09, or 39.8%, to average $30.45/b. The term structure of all three crude benchmarks – ICE Brent, NYMEX WTI and DME Oman – moved to a super contango in March, and money managers cut speculative net long positions.
World Economy
The world economy is forecast to face a severe recession in 2020, declining by 1.5%, following global economic growth of 2.9% in the previous year. Following tender signs of improvement at the beginning of the year, expectations for global economic growth were quickly burdened by the strong impact of the COVID-19 pandemic. Within the OECD, the US is forecast to contract by 4.1% in 2020, following growth of 2.3% in 2019. An even larger decline is expected in the Euro-zone, where economic activity is forecast to fall by 6.0% in 2020, compared to growth of 1.2% in 2019. Japan is forecast to contract by 3.9% in 2020, comparing to growth of 0.7% in 2019. China’s 2020 GDP is forecast to grow by 1.5%, recovering from a sharp contraction in 1Q20 and following growth of 6.1% in 2019. India is forecast to grow by only 2.0%, a sharp slowdown from already weakening growth of 5.3% in 2019. Brazil’s economy is forecast to contract by 2.4% in 2020, following growth of 1.0% in 2019. Russia’s economy is forecast to contract by 0.5% in 2020, after growth of 1.4% in 2019, not only due to COVID-19, but also because of the considerable decline in oil prices. As risk remains to be skewed to the downside, further revisions may be warranted going forward.
World Oil Demand
World oil demand growth forecast for 2019 is kept unchanged at 0.83 mb/d, compared with the previous month’s assessment. For 2020, the world oil demand growth forecast is revised lower by 6.9 mb/d, to a historical drop of around 6.8 mb/d. The contraction in the 2Q of this year is expected to be around 12 mb/d, with April witnessing the worst contraction at about 20 mb/d. The impact of the COVID-19 outbreak in China in 1Q20, and its negative impact on transportation and industrial fuels in the country, has since spread globally and is now affecting oil demand growth in most other countries and regions, with an unprecedented impact on global oil demand, transportation fuels in particular. As a result, OECD oil demand is revised lower by 3.7 mb/d to decline by 4.0 mb/d, while non-OECD oil demand growth is adjusted lower by 3.2 mb/d to contract by 2.9 mb/d for the year. Considering latest developments, and the large uncertainties going forward, downward risks remain significant, suggesting possibility of further adjustments, especially in the 2Q, should new data and further developments warrant revisions.
World Oil Supply Non-OPEC oil supply growth in 2019 is revised down by 0.01 mb/d from the previous month’s assessment and is now estimated at 1.98 mb/d. For 2020, non-OPEC oil supply is forecast to decline by 1.50 mb/d, a downward revision of 3.26 mb/d from the previous projection. The impact of COVID-19, ensuing global economic recession and oil demand shock, will also lead to supply disruptions. Benchmark oil prices plunge prompted companies to respond by cutting capital expenditure to the lowest in 13 years. The 2020 oil supply growth forecast for the US was revised down by 1.05 mb/d to show a decline of 0.15 mb/d y-o-y. The supply growth for the 10 non-OPEC countries participating in the Declaration of Cooperation has also been adjusted lower. Oil supply in 2020 is now forecast to show growth only in Norway, Brazil, Guyana and Australia. OPEC NGLs production in 2019 is estimated to have grown by 0.04 mb/d to average 4.79 mb/d and for 2020 will grow by 0.04 mb/d to average 4.83 mb/d. In March, OPEC crude oil production increased by 821 tb/d m-o-m to average 28.61 mb/d, according to secondary sources.
Product Markets and Refining Operations
Global refinery margins globally showed mixed performance during March. In the US, margins weakened as strength in gasoil/diesel was offset by losses in gasoline cracks, as complex margins came close to negative territory. In Europe, product markets strengthened slightly at the middle of the barrel, supported by a fall in feedstock prices. An already relatively tight global gasoil market saw support from output cuts and continued critical industrial activities for essential services and goods amid COVID-19. However, in Asia, margins eased towards the end of the month, pressured by a weaker top of the barrel, despite healthy gasoil and fuel oil crack spreads.
Tanker Market
The tanker market has been one of few segments of the oil industry that enjoyed positive momentum in March. A sudden surge in crude exports boosted demand for VLCCs, which pulled up Suezmax rates as well. Dirty spot freight rates declined mid-month before climbing again as the market was supported by high demand for tankers as charterers rushed to place cargoes amid a collapse in demand due to the COVID-19 pandemic. Increased options for time-chartering, including for floating storage, underscored the build-up of excess supply of crude and products in the market. For the month, dirty spot rates averaged 69% higher m-o-m in March. Clean tanker spot freight rates rose 12% m-o-m, as the need to find homes for excess product supplies supported the market.
Trade
Crude and product trade flows have been notably affected by the COVID-19 pandemic and the uncertain outlook going forward, although there has been some lag in how the various regions have been affected. US crude exports had a strong start to the year, averaging 3.5 mb/d in 1Q20, a gain of 0.8 mb/d over the same quarter last year, as the US remained a net liquids exporter for the seventh-consecutive month. Meanwhile, China’s crude imports averaged 10.5 mb/d over the first two months of 2020, declining from December as disruptions caused by COVID-19 led to some imports being diverted or delayed. Product trade was also affected, with imports and exports averaging 0.3 mb/d lower in the first two months of the year compared to December. Official data showed India’s crude imports increasing slightly in February, although some estimates show a higher jump as the country took in some discounted cargoes diverted from China. India’s crude and product trade is likely to be broadly impacted in March by a government-ordered lockdown.
Stock Movements
OECD commercial oil stocks rose by 5.6 mb, m-o-m, in February to stand at 2,945 mb. This was 64.3 mb higher than the same time one year ago and 24.7 mb above the latest five-year average. Within components, crude stocks fell by 6.1 mb, while product stocks rose by 11.7 mb, m-o-m. In terms of days of forward cover, OECD commercial stocks rose by 5.0 days, m-o-m, in February to stand at 72.7 days. This was 11.5 days above the same period in 2019, and 10.3 days above the latest five-year average. Preliminary data for March showed that US total commercial oil stocks increased by 8.2 mb, m-o-m, to stand at 1,922 mb. This was 31.8 mb, or 1.7%, above the same period a year ago, and 16.2 mb, or 0.8%, lower than the latest five-year average. Within components, crude stocks rose by 25.1 mb, while product stocks fell by 16.8 mb, m-o-m.
Balance of Supply and Demand
Demand for OPEC crude in 2019 stood at 29.9 mb/d, 1.2 mb/d lower than the 2018 level. Following the recent agreement reached at the extraordinary OPEC and non-OPEC Ministerial Meetings, the demand for OPEC crude in 2020 is expected at 24.5 mb/d, around 5.4 mb/d lower than the 2019 level, though this remains heavily subject to uncertainty surrounding current market conditions.
Source: OPEC
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Sunday, 26 April 20
STRONGER BUNKER PRICES FAIL TO RALLY FREIGHT MARKET - FIS
VLSFO bunker prices rebounded by $22.50 to $229/mt in the port of Singapore but failed to turn around the spot freight market.
Some ...
Saturday, 25 April 20
KOREA SOUTH-EAST POWER CO. INVITED BIDS FOR 780K - 900K MT OF 5600 NCV COAL FOR JULY TO OCTOBER 2020 LOADING
COALspot.com: South Korea’s KOREA SOUTH-EAST POWER CO., LTD. (KOEN) has issued an international tender for 780,000~900,000 Metric Tons (MT) s ...
Saturday, 25 April 20
SEAFARER MENTAL WELLBEING DURING THE COVID-19 PANDEMIC - STANDARD CLUB
KNOWLEDGE TO ELEVATE
COVID-19 has forced many parts of the world to enforce a lockdown in a bid to flatten the curve in terms of transmissions ...
Friday, 24 April 20
KOMIPO INVITED BIDS FOR 5700 NAR COAL FOR JUNE & JULY LOADING
COALspot.com: South Korea’s Korea Midland Power Co. Ltd. (KOMIPO) Has Issued An International Tender For 260,000 Metric Tons (MT) Steam Coal ...
Friday, 24 April 20
CHINA'S BENCHMARK POWER COAL PRICE REMAINS FLAT - XINHUA
China’s benchmark power coal price remained flat during the past week.
The Bohai-Rim Steam-Coal Price Index (BSPI), a gauge of ...
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- Indogreen Group - Indonesia
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Bhoruka Overseas - Indonesia
- Jindal Steel & Power Ltd - India
- Gujarat Mineral Development Corp Ltd - India
- Ministry of Finance - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Vedanta Resources Plc - India
- Sojitz Corporation - Japan
- Karbindo Abesyapradhi - Indoneisa
- Kalimantan Lumbung Energi - Indonesia
- Bukit Baiduri Energy - Indonesia
- Renaissance Capital - South Africa
- Posco Energy - South Korea
- Indika Energy - Indonesia
- Commonwealth Bank - Australia
- Kohat Cement Company Ltd. - Pakistan
- Makarim & Taira - Indonesia
- Tamil Nadu electricity Board
- Aboitiz Power Corporation - Philippines
- Uttam Galva Steels Limited - India
- Australian Commodity Traders Exchange
- The University of Queensland
- Antam Resourcindo - Indonesia
- Singapore Mercantile Exchange
- Energy Link Ltd, New Zealand
- Independent Power Producers Association of India
- Port Waratah Coal Services - Australia
- Intertek Mineral Services - Indonesia
- SMC Global Power, Philippines
- TNB Fuel Sdn Bhd - Malaysia
- ASAPP Information Group - India
- Latin American Coal - Colombia
- PetroVietnam Power Coal Import and Supply Company
- Trasteel International SA, Italy
- Petrochimia International Co. Ltd.- Taiwan
- Medco Energi Mining Internasional
- Kaltim Prima Coal - Indonesia
- VISA Power Limited - India
- Coal and Oil Company - UAE
- Ministry of Mines - Canada
- Directorate Of Revenue Intelligence - India
- Chamber of Mines of South Africa
- Eastern Coal Council - USA
- Bharathi Cement Corporation - India
- Essar Steel Hazira Ltd - India
- Lanco Infratech Ltd - India
- IHS Mccloskey Coal Group - USA
- TeaM Sual Corporation - Philippines
- Dalmia Cement Bharat India
- Semirara Mining and Power Corporation, Philippines
- Georgia Ports Authority, United States
- Kumho Petrochemical, South Korea
- Krishnapatnam Port Company Ltd. - India
- Gujarat Sidhee Cement - India
- Pendopo Energi Batubara - Indonesia
- Star Paper Mills Limited - India
- Karaikal Port Pvt Ltd - India
- Standard Chartered Bank - UAE
- Grasim Industreis Ltd - India
- Energy Development Corp, Philippines
- Larsen & Toubro Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- Global Business Power Corporation, Philippines
- GVK Power & Infra Limited - India
- Wilmar Investment Holdings
- AsiaOL BioFuels Corp., Philippines
- Bank of Tokyo Mitsubishi UFJ Ltd
- Carbofer General Trading SA - India
- India Bulls Power Limited - India
- Tata Chemicals Ltd - India
- Miang Besar Coal Terminal - Indonesia
- Vizag Seaport Private Limited - India
- Indo Tambangraya Megah - Indonesia
- Central Electricity Authority - India
- Mjunction Services Limited - India
- Meralco Power Generation, Philippines
- Indonesian Coal Mining Association
- Siam City Cement PLC, Thailand
- Gujarat Electricity Regulatory Commission - India
- Neyveli Lignite Corporation Ltd, - India
- Kideco Jaya Agung - Indonesia
- Thai Mozambique Logistica
- Barasentosa Lestari - Indonesia
- Jorong Barutama Greston.PT - Indonesia
- Power Finance Corporation Ltd., India
- Rio Tinto Coal - Australia
- Binh Thuan Hamico - Vietnam
- Kartika Selabumi Mining - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- ICICI Bank Limited - India
- Australian Coal Association
- OPG Power Generation Pvt Ltd - India
- Indian Energy Exchange, India
- International Coal Ventures Pvt Ltd - India
- Goldman Sachs - Singapore
- Straits Asia Resources Limited - Singapore
- Therma Luzon, Inc, Philippines
- Sindya Power Generating Company Private Ltd
- IEA Clean Coal Centre - UK
- Orica Australia Pty. Ltd.
- Bhushan Steel Limited - India
- Bulk Trading Sa - Switzerland
- GMR Energy Limited - India
- Maheswari Brothers Coal Limited - India
- Toyota Tsusho Corporation, Japan
- Bhatia International Limited - India
- White Energy Company Limited
- Salva Resources Pvt Ltd - India
- Cement Manufacturers Association - India
- Wood Mackenzie - Singapore
- Borneo Indobara - Indonesia
- London Commodity Brokers - England
- Altura Mining Limited, Indonesia
- Coalindo Energy - Indonesia
- Ministry of Transport, Egypt
- Savvy Resources Ltd - HongKong
- GAC Shipping (India) Pvt Ltd
- Merrill Lynch Commodities Europe
- Indian Oil Corporation Limited
- Interocean Group of Companies - India
- Simpson Spence & Young - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Kepco SPC Power Corporation, Philippines
- Electricity Generating Authority of Thailand
- PowerSource Philippines DevCo
- Price Waterhouse Coopers - Russia
- Planning Commission, India
- The Treasury - Australian Government
- CNBM International Corporation - China
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Directorate General of MIneral and Coal - Indonesia
- Deloitte Consulting - India
- Rashtriya Ispat Nigam Limited - India
- Global Coal Blending Company Limited - Australia
- Banpu Public Company Limited - Thailand
- Iligan Light & Power Inc, Philippines
- The State Trading Corporation of India Ltd
- Marubeni Corporation - India
- Eastern Energy - Thailand
- Africa Commodities Group - South Africa
- South Luzon Thermal Energy Corporation
- McConnell Dowell - Australia
- Riau Bara Harum - Indonesia
- Anglo American - United Kingdom
- New Zealand Coal & Carbon
- Bangladesh Power Developement Board
- Minerals Council of Australia
- Petron Corporation, Philippines
- Sree Jayajothi Cements Limited - India
- Madhucon Powers Ltd - India
- PTC India Limited - India
- GN Power Mariveles Coal Plant, Philippines
- Heidelberg Cement - Germany
- Mintek Dendrill Indonesia
- Kapuas Tunggal Persada - Indonesia
- Sakthi Sugars Limited - India
- LBH Netherlands Bv - Netherlands
- Ambuja Cements Ltd - India
- Thiess Contractors Indonesia
- Siam City Cement - Thailand
- Orica Mining Services - Indonesia
- Baramulti Group, Indonesia
- Bukit Makmur.PT - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Meenaskhi Energy Private Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Attock Cement Pakistan Limited
- Mercuria Energy - Indonesia
- Globalindo Alam Lestari - Indonesia
- SN Aboitiz Power Inc, Philippines
- Sinarmas Energy and Mining - Indonesia
- Aditya Birla Group - India
- Sarangani Energy Corporation, Philippines
- Kobexindo Tractors - Indoneisa
- Videocon Industries ltd - India
- Bayan Resources Tbk. - Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Electricity Authority, New Zealand
- Xindia Steels Limited - India
- Mercator Lines Limited - India
- Billiton Holdings Pty Ltd - Australia
- Malabar Cements Ltd - India
- CIMB Investment Bank - Malaysia
- Economic Council, Georgia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Jaiprakash Power Ventures ltd
- Oldendorff Carriers - Singapore
- Parliament of New Zealand
- Chettinad Cement Corporation Ltd - India
- Edison Trading Spa - Italy
- Central Java Power - Indonesia
- Coastal Gujarat Power Limited - India
- Timah Investasi Mineral - Indoneisa
- Cigading International Bulk Terminal - Indonesia
- European Bulk Services B.V. - Netherlands
- Bukit Asam (Persero) Tbk - Indonesia
- Manunggal Multi Energi - Indonesia
- San Jose City I Power Corp, Philippines
- Metalloyd Limited - United Kingdom
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Formosa Plastics Group - Taiwan
- Samtan Co., Ltd - South Korea
- Romanian Commodities Exchange
- MS Steel International - UAE
- Semirara Mining Corp, Philippines
- SMG Consultants - Indonesia
- Leighton Contractors Pty Ltd - Australia
- Agrawal Coal Company - India
- Ceylon Electricity Board - Sri Lanka
- Parry Sugars Refinery, India
- PNOC Exploration Corporation - Philippines
- Alfred C Toepfer International GmbH - Germany
- Ind-Barath Power Infra Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Sical Logistics Limited - India
- Global Green Power PLC Corporation, Philippines
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