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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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Tuesday, 24 March 20
CHINA TAIYUAN COAL TRANSACTION PRICE INDEX DOWN 0.28 PCT - XINHUA
China Taiyuan coal transaction price index stood at 132.74 points Monday, down 0.28 percent week on week.
The index, released by Chi ...
Monday, 23 March 20
CHARTERPARTY REQUIREMENTS TO NOTIFY CLAIMS - TAKE CARE! - WFW
KNOWLEDGE TO ELEVATE
Voyage charterparties frequently require the owner to notify any claim with supporting documents within a relatively shor ...
Monday, 23 March 20
COAL INDIA LIMITED'S ONE-DAY OUTPUT PEAKS AT 3.17 MT - THE HINDU
Coal India Limited (CIL) output peaked at a new high of 3.17 million tonnes (MT) on March 20, overtaking the 3.14 MT production recorded on March 2 ...
Monday, 23 March 20
KOMIPO INVITED BIDS FOR 1.45 MILLION TONS OF COAL FOR JUNE & JULY 2020 LOADING
COALspot.com: Korea Midland Power Co.,Ltd (KOMIPO), on behalf of five Korean Gencos, has issued an international tender for total 1,450,000 MT (&pl ...
Saturday, 21 March 20
PANAMAX: 82,000DWT SHIP AGREED $4,250 FOR A COAL TRIP VIA INDONESIA REDELIVERY SOUTH CHINA - BALTIC BRIEFING
Capesize
The Capesize market made some headway this past week despite being buffeted by the global pandemic storm. With the market in a constan ...
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- Timah Investasi Mineral - Indoneisa
- Miang Besar Coal Terminal - Indonesia
- San Jose City I Power Corp, Philippines
- Globalindo Alam Lestari - Indonesia
- Coalindo Energy - Indonesia
- TNB Fuel Sdn Bhd - Malaysia
- Vijayanagar Sugar Pvt Ltd - India
- Holcim Trading Pte Ltd - Singapore
- Electricity Generating Authority of Thailand
- Sindya Power Generating Company Private Ltd
- Trasteel International SA, Italy
- Malabar Cements Ltd - India
- Ind-Barath Power Infra Limited - India
- Energy Development Corp, Philippines
- Metalloyd Limited - United Kingdom
- Indo Tambangraya Megah - Indonesia
- Bayan Resources Tbk. - Indonesia
- The State Trading Corporation of India Ltd
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- PNOC Exploration Corporation - Philippines
- Commonwealth Bank - Australia
- AsiaOL BioFuels Corp., Philippines
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Sical Logistics Limited - India
- Central Electricity Authority - India
- Orica Mining Services - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Siam City Cement - Thailand
- Krishnapatnam Port Company Ltd. - India
- Altura Mining Limited, Indonesia
- Larsen & Toubro Limited - India
- Ministry of Transport, Egypt
- Antam Resourcindo - Indonesia
- Madhucon Powers Ltd - India
- Deloitte Consulting - India
- Jorong Barutama Greston.PT - Indonesia
- Wood Mackenzie - Singapore
- Maharashtra Electricity Regulatory Commission - India
- GMR Energy Limited - India
- Cement Manufacturers Association - India
- Ministry of Mines - Canada
- CIMB Investment Bank - Malaysia
- The University of Queensland
- Global Coal Blending Company Limited - Australia
- Pendopo Energi Batubara - Indonesia
- White Energy Company Limited
- Karbindo Abesyapradhi - Indoneisa
- Mercator Lines Limited - India
- Siam City Cement PLC, Thailand
- Power Finance Corporation Ltd., India
- Simpson Spence & Young - Indonesia
- New Zealand Coal & Carbon
- Bhushan Steel Limited - India
- Port Waratah Coal Services - Australia
- Formosa Plastics Group - Taiwan
- Rashtriya Ispat Nigam Limited - India
- Savvy Resources Ltd - HongKong
- GAC Shipping (India) Pvt Ltd
- Medco Energi Mining Internasional
- VISA Power Limited - India
- CNBM International Corporation - China
- Edison Trading Spa - Italy
- Gujarat Mineral Development Corp Ltd - India
- GVK Power & Infra Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Australian Commodity Traders Exchange
- Kohat Cement Company Ltd. - Pakistan
- Asmin Koalindo Tuhup - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- TeaM Sual Corporation - Philippines
- Mercuria Energy - Indonesia
- Manunggal Multi Energi - Indonesia
- Posco Energy - South Korea
- Borneo Indobara - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Jaiprakash Power Ventures ltd
- Star Paper Mills Limited - India
- SN Aboitiz Power Inc, Philippines
- PetroVietnam Power Coal Import and Supply Company
- Electricity Authority, New Zealand
- Barasentosa Lestari - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Bangladesh Power Developement Board
- European Bulk Services B.V. - Netherlands
- Bukit Baiduri Energy - Indonesia
- Tamil Nadu electricity Board
- Indonesian Coal Mining Association
- Oldendorff Carriers - Singapore
- Salva Resources Pvt Ltd - India
- Bukit Asam (Persero) Tbk - Indonesia
- Vizag Seaport Private Limited - India
- Parry Sugars Refinery, India
- Lanco Infratech Ltd - India
- Minerals Council of Australia
- Thai Mozambique Logistica
- Global Business Power Corporation, Philippines
- Standard Chartered Bank - UAE
- Tata Chemicals Ltd - India
- Kartika Selabumi Mining - Indonesia
- Rio Tinto Coal - Australia
- Straits Asia Resources Limited - Singapore
- Parliament of New Zealand
- Semirara Mining and Power Corporation, Philippines
- Essar Steel Hazira Ltd - India
- Xindia Steels Limited - India
- Goldman Sachs - Singapore
- Bahari Cakrawala Sebuku - Indonesia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- LBH Netherlands Bv - Netherlands
- London Commodity Brokers - England
- Interocean Group of Companies - India
- Chettinad Cement Corporation Ltd - India
- Kalimantan Lumbung Energi - Indonesia
- Marubeni Corporation - India
- Coastal Gujarat Power Limited - India
- Gujarat Sidhee Cement - India
- Kobexindo Tractors - Indoneisa
- Ceylon Electricity Board - Sri Lanka
- Georgia Ports Authority, United States
- Jindal Steel & Power Ltd - India
- MS Steel International - UAE
- Karaikal Port Pvt Ltd - India
- ASAPP Information Group - India
- Banpu Public Company Limited - Thailand
- IHS Mccloskey Coal Group - USA
- Meralco Power Generation, Philippines
- Wilmar Investment Holdings
- Carbofer General Trading SA - India
- Kepco SPC Power Corporation, Philippines
- Intertek Mineral Services - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Independent Power Producers Association of India
- The Treasury - Australian Government
- Coal and Oil Company - UAE
- Dalmia Cement Bharat India
- Binh Thuan Hamico - Vietnam
- Gujarat Electricity Regulatory Commission - India
- Neyveli Lignite Corporation Ltd, - India
- Orica Australia Pty. Ltd.
- Semirara Mining Corp, Philippines
- Indika Energy - Indonesia
- Australian Coal Association
- Attock Cement Pakistan Limited
- Meenaskhi Energy Private Limited - India
- Aditya Birla Group - India
- India Bulls Power Limited - India
- SMC Global Power, Philippines
- Therma Luzon, Inc, Philippines
- Bukit Makmur.PT - Indonesia
- IEA Clean Coal Centre - UK
- Thiess Contractors Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Toyota Tsusho Corporation, Japan
- Mintek Dendrill Indonesia
- Economic Council, Georgia
- Samtan Co., Ltd - South Korea
- Global Green Power PLC Corporation, Philippines
- Renaissance Capital - South Africa
- SMG Consultants - Indonesia
- Eastern Coal Council - USA
- Anglo American - United Kingdom
- Pipit Mutiara Jaya. PT, Indonesia
- Bulk Trading Sa - Switzerland
- Romanian Commodities Exchange
- Africa Commodities Group - South Africa
- Kideco Jaya Agung - Indonesia
- OPG Power Generation Pvt Ltd - India
- International Coal Ventures Pvt Ltd - India
- Directorate Of Revenue Intelligence - India
- Merrill Lynch Commodities Europe
- Uttam Galva Steels Limited - India
- ICICI Bank Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Kumho Petrochemical, South Korea
- Sakthi Sugars Limited - India
- PTC India Limited - India
- Ministry of Finance - Indonesia
- South Luzon Thermal Energy Corporation
- Planning Commission, India
- Baramulti Group, Indonesia
- Sree Jayajothi Cements Limited - India
- Mjunction Services Limited - India
- Energy Link Ltd, New Zealand
- Indian Oil Corporation Limited
- Aboitiz Power Corporation - Philippines
- Kapuas Tunggal Persada - Indonesia
- Latin American Coal - Colombia
- Chamber of Mines of South Africa
- Agrawal Coal Company - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- McConnell Dowell - Australia
- Bharathi Cement Corporation - India
- Sinarmas Energy and Mining - Indonesia
- Vedanta Resources Plc - India
- Kaltim Prima Coal - Indonesia
- Maheswari Brothers Coal Limited - India
- Singapore Mercantile Exchange
- Petron Corporation, Philippines
- Eastern Energy - Thailand
- Central Java Power - Indonesia
- Bhatia International Limited - India
- Price Waterhouse Coopers - Russia
- Ambuja Cements Ltd - India
- Sojitz Corporation - Japan
- Riau Bara Harum - Indonesia
- Indogreen Group - Indonesia
- Makarim & Taira - Indonesia
- Grasim Industreis Ltd - India
- Directorate General of MIneral and Coal - Indonesia
- Sarangani Energy Corporation, Philippines
- Indian Energy Exchange, India
- Iligan Light & Power Inc, Philippines
- Videocon Industries ltd - India
- Heidelberg Cement - Germany
- PowerSource Philippines DevCo
- Bhoruka Overseas - Indonesia
- Leighton Contractors Pty Ltd - Australia
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