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Friday, 08 May 20
LNG DEMAND FACED SEVERAL HEADWINDS IN THE FIRST QUARTER OF 2020 - GASLOG
 LNG demand faced several headwinds in the first quarter of 2020 including a warmer than average winter in the northern hemisphere, high inventory levels of natural gas and LNG in several of the largest end markets for LNG and the outbreak of COVID-19, the impact of which has had an uneven distribution around the world during the year to date. For example, Chinese demand was 15 million tonnes (“mt”) in the first quarter of 2020, a decrease of 5% over the first quarter of 2019, according to Poten, but apparent demand in April has increased year-on-year based on vessel tracking data, including several cargoes exported from the U.S., GasLog says in its latest financial report.
Gaslog further noted, meanwhile, demand from Northern Asia more broadly (Japan, China, South Korea and Taiwan) grew by approximately 1 mt in the first quarter or 3% year-over-year. In addition, demand from India grew by nearly 2 mt in the first quarter of 2020 (or 37%) as the country looked to take advantage of historically low gas prices, although apparent demand in April is likely to be lower year-on-year based on vessel tracking data. Finally, demand from Europe grew by over 4 mt (or 37%) as gas pricing favored coal-to-gas switching for power generation and LNG replaces indigenous gas production. In total, LNG demand was 98 mt in the first quarter of 2020, compared to 89 mt in the first quarter of 2019, or an increase of 10%.
Wood Mackenzie currently expects global LNG demand to grow 21 mt or 6% this year, slower than the 26 mt or 7% it anticipated earlier this year prior to the global outbreak of COVID-19. Nonetheless, the demand for LNG over the near-term continues to be uncertain as many LNG importing countries either continue to have in effect shelter-in-place orders which prevent the operation of businesses deemed to be “non-essential” or are in the early stages of reopening their economies. Consequently, measures of global economic activity have declined significantly from comparable periods in 2019. However, the longer-term outlook for LNG demand remains favorable with demand growth of 92 mt estimated over the 2019-2025 timeframe, or compound annual growth of approximately 4%, according to Wood Mackenzie.
According to GasLog's latest financial report, global LNG supply was approximately 98 mt in the first quarter of 2020, an increase of 10 mt over the first quarter of 2019 (or 11%), primarily due to new supply additions in the U.S. (Cameron T1 and T2, Freeport T1, T2 and T3 and Elba Island), according to estimates from Wood Mackenzie. LNG supply is estimated to grow by 22 mt this year as the third train of Cameron begins operations and recent capacity additions continue to increase production. Further ahead, approximately 97 mt of new LNG capacity is expected to begin production during 2021-2025. However, Wood Mackenzie expects the pace of new project sanctions to slow significantly in 2020 due to the uncertainties caused by the COVID-19 outbreak in long-term demand for LNG and low global energy prices, in particular crude oil prices due to oversupply following a collapse in oil demand due to the COVID-19 virus.
In the LNG shipping spot market, tri-fuel diesel electric vessel (“TFDE”) headline rates, as reported by Clarksons, averaged $57,000 per day in the first quarter of 2020, a decrease from the averages of $108,000 in the fourth quarter of 2019 and $59,500 in the first quarter of 2019. Headline spot rates for steam turbine propulsion (“Steam”) vessels averaged $40,000 per day in the first quarter of 2020, a decrease from the average of $78,000 per day in the fourth quarter of 2019 but approximately in line with the $39,000 per day observed in the first quarter of 2019. Slower than expected LNG demand growth due in part to the impact of COVID-19 (as detailed above), high global inventories of natural gas and LNG following a warmer than average winter in the Northern Hemisphere and limited opportunities for LNG arbitrage trading between Atlantic and Pacific basins impacted headline spot rates in the first quarter of 2020.
Clarksons currently assesses headline spot rates for TFDE and Steam LNG carriers at $32,500 per day and $23,000 per day, respectively. The COVID-19 outbreak has introduced significant uncertainty regarding demand for LNG, and consequently, demand for LNG shipping over the near term. The combined impact of the COVID-19 outbreak and normal seasonality may lead to greater volatility in spot rates and to lower utilization of vessels trading in the spot and short-term markets, in particular Steam vessels. In addition, global gas prices and gas price differentials remain near historic lows in the key markets of North Asia and Europe, limiting the opportunities for inter-basin arbitrage trading and likely reducing average voyage distances as well as potentially reducing global output of LNG over the near-term, particularly in the U.S., where a number of cargo deferrals and/or cancellations have been reported for this summer, said GasLog.
As of May 5, 2020, the orderbook totals 118 dedicated LNG carriers (>100,000 cbm), according to estimates from Poten, representing 22% of the on-the-water fleet. Of these, 74 vessels (or 63%) have multi-year charters. The pace of newbuild ordering has slowed significantly relative to 2018-19, with only 4 newbuildings ordered so far in 2020 and all of them ordered against multi-year contracts, an encouraging development for the future supply and demand balance of LNG carriers.
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Tuesday, 11 April 23
OIL RISES ON CHINA STIMULUS EXPECTATIONS, WEAKER DOLLAR - REUTERS
Oil prices rose on Tuesday on expectations of potential economic stimulus by China, healthy demand in the rest of Asia and a drop in U.S. crude sto ...
Sunday, 09 April 23
CHINA’S BUSINESS INCOME REBOUND POINTS TO IMPROVING ECONOMY: OFFICIAL - XINHUA
Chinese businesses have posted a strong rebound in sales revenue since the beginning of this year in the latest signal of an improving economy.
...
Sunday, 09 April 23
COAL INDIA TO BOOST SUPPLIES TO INDUSTRIES AS UTILITIES’ INVENTORIES RISE - REUTERS
Coal India Ltd will increase supplies to industries, the world’s largest coal miner said on Wednesday as fuel inventories at utilities run by ...
Thursday, 06 April 23
MARKET INSIGHT - INTERMODAL
LNG Current Supply/Demand Dynamics
This year, LNG supply will likely exceed demand, so prices will need to decline to levels that will encourag ...
Sunday, 26 March 23
EUROPE’S RUSH TO LNG COULD TURN INTO 'WORLD’S MOST EXPENSIVE AND UNNECESSARY INSURANCE POLICY'- CNBC
Europe’s rapid buildout of liquefied natural gas infrastructure is on track to far exceed demand by the end of the decade, according to new r ...
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- IHS Mccloskey Coal Group - USA
- South Luzon Thermal Energy Corporation
- IEA Clean Coal Centre - UK
- TNB Fuel Sdn Bhd - Malaysia
- Asmin Koalindo Tuhup - Indonesia
- TeaM Sual Corporation - Philippines
- Metalloyd Limited - United Kingdom
- Larsen & Toubro Limited - India
- Simpson Spence & Young - Indonesia
- Baramulti Group, Indonesia
- Kepco SPC Power Corporation, Philippines
- Semirara Mining and Power Corporation, Philippines
- Renaissance Capital - South Africa
- Agrawal Coal Company - India
- Vedanta Resources Plc - India
- Billiton Holdings Pty Ltd - Australia
- Sree Jayajothi Cements Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- MS Steel International - UAE
- PNOC Exploration Corporation - Philippines
- GMR Energy Limited - India
- Indo Tambangraya Megah - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- CIMB Investment Bank - Malaysia
- SMC Global Power, Philippines
- Jorong Barutama Greston.PT - Indonesia
- Indogreen Group - Indonesia
- Bulk Trading Sa - Switzerland
- European Bulk Services B.V. - Netherlands
- Indian Oil Corporation Limited
- Globalindo Alam Lestari - Indonesia
- Semirara Mining Corp, Philippines
- GVK Power & Infra Limited - India
- Global Coal Blending Company Limited - Australia
- Electricity Authority, New Zealand
- Kobexindo Tractors - Indoneisa
- Krishnapatnam Port Company Ltd. - India
- Karbindo Abesyapradhi - Indoneisa
- Posco Energy - South Korea
- Siam City Cement PLC, Thailand
- Barasentosa Lestari - Indonesia
- Attock Cement Pakistan Limited
- Bhoruka Overseas - Indonesia
- Coalindo Energy - Indonesia
- Star Paper Mills Limited - India
- Cigading International Bulk Terminal - Indonesia
- Anglo American - United Kingdom
- Chamber of Mines of South Africa
- Offshore Bulk Terminal Pte Ltd, Singapore
- Kideco Jaya Agung - Indonesia
- Commonwealth Bank - Australia
- Jindal Steel & Power Ltd - India
- Pipit Mutiara Jaya. PT, Indonesia
- Gujarat Sidhee Cement - India
- Georgia Ports Authority, United States
- Standard Chartered Bank - UAE
- Savvy Resources Ltd - HongKong
- Bharathi Cement Corporation - India
- Ministry of Mines - Canada
- Kaltim Prima Coal - Indonesia
- Bukit Baiduri Energy - Indonesia
- Samtan Co., Ltd - South Korea
- Straits Asia Resources Limited - Singapore
- Makarim & Taira - Indonesia
- Miang Besar Coal Terminal - Indonesia
- Siam City Cement - Thailand
- Latin American Coal - Colombia
- Gujarat Electricity Regulatory Commission - India
- Malabar Cements Ltd - India
- San Jose City I Power Corp, Philippines
- Parliament of New Zealand
- Eastern Energy - Thailand
- Antam Resourcindo - Indonesia
- Chettinad Cement Corporation Ltd - India
- London Commodity Brokers - England
- SN Aboitiz Power Inc, Philippines
- Medco Energi Mining Internasional
- Energy Link Ltd, New Zealand
- Ambuja Cements Ltd - India
- Ind-Barath Power Infra Limited - India
- Manunggal Multi Energi - Indonesia
- Sojitz Corporation - Japan
- Salva Resources Pvt Ltd - India
- Videocon Industries ltd - India
- Rashtriya Ispat Nigam Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Mercator Lines Limited - India
- Sindya Power Generating Company Private Ltd
- Bayan Resources Tbk. - Indonesia
- Riau Bara Harum - Indonesia
- ASAPP Information Group - India
- Coastal Gujarat Power Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Independent Power Producers Association of India
- Neyveli Lignite Corporation Ltd, - India
- Marubeni Corporation - India
- PTC India Limited - India
- Bukit Makmur.PT - Indonesia
- Madhucon Powers Ltd - India
- Sakthi Sugars Limited - India
- Aboitiz Power Corporation - Philippines
- Romanian Commodities Exchange
- Intertek Mineral Services - Indonesia
- SMG Consultants - Indonesia
- Grasim Industreis Ltd - India
- Edison Trading Spa - Italy
- Economic Council, Georgia
- Sarangani Energy Corporation, Philippines
- Parry Sugars Refinery, India
- Xindia Steels Limited - India
- Tamil Nadu electricity Board
- Dalmia Cement Bharat India
- New Zealand Coal & Carbon
- Tata Chemicals Ltd - India
- Timah Investasi Mineral - Indoneisa
- Wood Mackenzie - Singapore
- Thiess Contractors Indonesia
- Global Business Power Corporation, Philippines
- Bangladesh Power Developement Board
- Kapuas Tunggal Persada - Indonesia
- Petron Corporation, Philippines
- Singapore Mercantile Exchange
- Therma Luzon, Inc, Philippines
- Minerals Council of Australia
- Meralco Power Generation, Philippines
- Thai Mozambique Logistica
- VISA Power Limited - India
- Sical Logistics Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Pendopo Energi Batubara - Indonesia
- Essar Steel Hazira Ltd - India
- Oldendorff Carriers - Singapore
- Kalimantan Lumbung Energi - Indonesia
- Mintek Dendrill Indonesia
- Coal and Oil Company - UAE
- Central Electricity Authority - India
- Formosa Plastics Group - Taiwan
- Global Green Power PLC Corporation, Philippines
- Bhushan Steel Limited - India
- Energy Development Corp, Philippines
- Merrill Lynch Commodities Europe
- Aditya Birla Group - India
- Cement Manufacturers Association - India
- Australian Coal Association
- India Bulls Power Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Uttam Galva Steels Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Ceylon Electricity Board - Sri Lanka
- Bahari Cakrawala Sebuku - Indonesia
- GAC Shipping (India) Pvt Ltd
- Price Waterhouse Coopers - Russia
- Maheswari Brothers Coal Limited - India
- White Energy Company Limited
- Meenaskhi Energy Private Limited - India
- Ministry of Finance - Indonesia
- Borneo Indobara - Indonesia
- Wilmar Investment Holdings
- Toyota Tsusho Corporation, Japan
- ICICI Bank Limited - India
- Indian Energy Exchange, India
- The State Trading Corporation of India Ltd
- Carbofer General Trading SA - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Trasteel International SA, Italy
- Gujarat Mineral Development Corp Ltd - India
- Central Java Power - Indonesia
- International Coal Ventures Pvt Ltd - India
- The University of Queensland
- Holcim Trading Pte Ltd - Singapore
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Bhatia International Limited - India
- Indika Energy - Indonesia
- Lanco Infratech Ltd - India
- CNBM International Corporation - China
- McConnell Dowell - Australia
- Vizag Seaport Private Limited - India
- LBH Netherlands Bv - Netherlands
- Ministry of Transport, Egypt
- Directorate Of Revenue Intelligence - India
- PowerSource Philippines DevCo
- Electricity Generating Authority of Thailand
- Banpu Public Company Limited - Thailand
- Australian Commodity Traders Exchange
- Interocean Group of Companies - India
- Orica Mining Services - Indonesia
- Power Finance Corporation Ltd., India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Indonesian Coal Mining Association
- Altura Mining Limited, Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Goldman Sachs - Singapore
- Heidelberg Cement - Germany
- Rio Tinto Coal - Australia
- Kumho Petrochemical, South Korea
- Kartika Selabumi Mining - Indonesia
- Deloitte Consulting - India
- Jaiprakash Power Ventures ltd
- Mjunction Services Limited - India
- Directorate General of MIneral and Coal - Indonesia
- Planning Commission, India
- OPG Power Generation Pvt Ltd - India
- Leighton Contractors Pty Ltd - Australia
- Alfred C Toepfer International GmbH - Germany
- AsiaOL BioFuels Corp., Philippines
- Mercuria Energy - Indonesia
- Orica Australia Pty. Ltd.
- Karaikal Port Pvt Ltd - India
- Binh Thuan Hamico - Vietnam
- Port Waratah Coal Services - Australia
- Sinarmas Energy and Mining - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Iligan Light & Power Inc, Philippines
- Africa Commodities Group - South Africa
- The Treasury - Australian Government
- Eastern Coal Council - USA
- Kohat Cement Company Ltd. - Pakistan
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