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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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Thursday, 13 October 22
OPEC DOWNGRADES CRUDE OIL DEMAND, AS WORLD ECONOMY ENTERS SLOWDOWN
Crude Oil Price Movements
The OPEC Reference Basket (ORB) declined m-o-m by $6.58 in September, or 6.5%, to average $95.32/b. Pressure from equ ...
Wednesday, 12 October 22
MARKET INSIGHT - INTERMODAL
Sale and Purchase activity during the first three quarters of 2022 has been remarkable.
Focusing only on Tankers and Bulkers, such v ...
Monday, 10 October 22
ENERGY TRANSITION BOOSTS GLOBAL LONG-TERM DEMAND FOR METALS - FITCH RATINGS
The energy transition will significantly increase demand for metals used in manufacturing of electric vehicles (EVs) and renewable power generation ...
Monday, 10 October 22
GLOBAL CEOS EXPECT IMPENDING RECESSION TO BE 'SHORT AND SHARP,' POLL SHOWS - CNBC
Global CEOs are anticipating a recession in the next 12 months, according to a new survey by professional services firm KPMG, which said more than ...
Thursday, 06 October 22
AUSTRALIA’S RESOURCES REVENUE TO HIT RECORD AMID UKRAINE CONFLICT - REUTERS
Australian resources and energy export earnings are forecast to jump 7% to a record A$450 billion ($290 billion) this fiscal year, bolstered by soa ...
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- Bukit Baiduri Energy - Indonesia
- Semirara Mining Corp, Philippines
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Iligan Light & Power Inc, Philippines
- Bangladesh Power Developement Board
- Power Finance Corporation Ltd., India
- Bukit Makmur.PT - Indonesia
- Kepco SPC Power Corporation, Philippines
- PNOC Exploration Corporation - Philippines
- London Commodity Brokers - England
- Electricity Authority, New Zealand
- Australian Commodity Traders Exchange
- Indonesian Coal Mining Association
- GMR Energy Limited - India
- GVK Power & Infra Limited - India
- Parliament of New Zealand
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Heidelberg Cement - Germany
- Jorong Barutama Greston.PT - Indonesia
- Karaikal Port Pvt Ltd - India
- IEA Clean Coal Centre - UK
- Baramulti Group, Indonesia
- San Jose City I Power Corp, Philippines
- VISA Power Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Sinarmas Energy and Mining - Indonesia
- Oldendorff Carriers - Singapore
- LBH Netherlands Bv - Netherlands
- Bahari Cakrawala Sebuku - Indonesia
- SMC Global Power, Philippines
- Aditya Birla Group - India
- Anglo American - United Kingdom
- Cement Manufacturers Association - India
- Coastal Gujarat Power Limited - India
- Sojitz Corporation - Japan
- Kartika Selabumi Mining - Indonesia
- Aboitiz Power Corporation - Philippines
- Pendopo Energi Batubara - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Romanian Commodities Exchange
- The Treasury - Australian Government
- Gujarat Electricity Regulatory Commission - India
- Bukit Asam (Persero) Tbk - Indonesia
- GAC Shipping (India) Pvt Ltd
- CIMB Investment Bank - Malaysia
- Grasim Industreis Ltd - India
- Kobexindo Tractors - Indoneisa
- Kapuas Tunggal Persada - Indonesia
- Chamber of Mines of South Africa
- Parry Sugars Refinery, India
- Indian Energy Exchange, India
- Thai Mozambique Logistica
- Sree Jayajothi Cements Limited - India
- Wilmar Investment Holdings
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Therma Luzon, Inc, Philippines
- Kideco Jaya Agung - Indonesia
- Goldman Sachs - Singapore
- Renaissance Capital - South Africa
- Asmin Koalindo Tuhup - Indonesia
- Timah Investasi Mineral - Indoneisa
- Ministry of Mines - Canada
- Commonwealth Bank - Australia
- Bhatia International Limited - India
- Binh Thuan Hamico - Vietnam
- MS Steel International - UAE
- Mjunction Services Limited - India
- PowerSource Philippines DevCo
- Gujarat Mineral Development Corp Ltd - India
- Jaiprakash Power Ventures ltd
- Intertek Mineral Services - Indonesia
- McConnell Dowell - Australia
- Petrochimia International Co. Ltd.- Taiwan
- Riau Bara Harum - Indonesia
- Agrawal Coal Company - India
- Energy Development Corp, Philippines
- Energy Link Ltd, New Zealand
- Australian Coal Association
- Ministry of Transport, Egypt
- Directorate Of Revenue Intelligence - India
- Kalimantan Lumbung Energi - Indonesia
- Samtan Co., Ltd - South Korea
- Attock Cement Pakistan Limited
- SMG Consultants - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Maheswari Brothers Coal Limited - India
- Bulk Trading Sa - Switzerland
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Jindal Steel & Power Ltd - India
- Meenaskhi Energy Private Limited - India
- Deloitte Consulting - India
- Ministry of Finance - Indonesia
- Savvy Resources Ltd - HongKong
- Port Waratah Coal Services - Australia
- Star Paper Mills Limited - India
- CNBM International Corporation - China
- Billiton Holdings Pty Ltd - Australia
- Central Electricity Authority - India
- Global Green Power PLC Corporation, Philippines
- Krishnapatnam Port Company Ltd. - India
- ASAPP Information Group - India
- Merrill Lynch Commodities Europe
- TeaM Sual Corporation - Philippines
- Edison Trading Spa - Italy
- Metalloyd Limited - United Kingdom
- Indian Oil Corporation Limited
- Posco Energy - South Korea
- Mintek Dendrill Indonesia
- Eastern Energy - Thailand
- International Coal Ventures Pvt Ltd - India
- Toyota Tsusho Corporation, Japan
- Leighton Contractors Pty Ltd - Australia
- Medco Energi Mining Internasional
- Sakthi Sugars Limited - India
- Miang Besar Coal Terminal - Indonesia
- Thiess Contractors Indonesia
- Lanco Infratech Ltd - India
- Siam City Cement - Thailand
- Antam Resourcindo - Indonesia
- Bhoruka Overseas - Indonesia
- SN Aboitiz Power Inc, Philippines
- Kohat Cement Company Ltd. - Pakistan
- Formosa Plastics Group - Taiwan
- Altura Mining Limited, Indonesia
- Tata Chemicals Ltd - India
- IHS Mccloskey Coal Group - USA
- Offshore Bulk Terminal Pte Ltd, Singapore
- Semirara Mining and Power Corporation, Philippines
- New Zealand Coal & Carbon
- PTC India Limited - India
- Mercuria Energy - Indonesia
- Neyveli Lignite Corporation Ltd, - India
- Uttam Galva Steels Limited - India
- Singapore Mercantile Exchange
- Bharathi Cement Corporation - India
- Manunggal Multi Energi - Indonesia
- OPG Power Generation Pvt Ltd - India
- Trasteel International SA, Italy
- India Bulls Power Limited - India
- The University of Queensland
- Videocon Industries ltd - India
- Eastern Coal Council - USA
- Xindia Steels Limited - India
- Wood Mackenzie - Singapore
- Latin American Coal - Colombia
- Banpu Public Company Limited - Thailand
- Ind-Barath Power Infra Limited - India
- Kaltim Prima Coal - Indonesia
- Alfred C Toepfer International GmbH - Germany
- Independent Power Producers Association of India
- Dalmia Cement Bharat India
- Vedanta Resources Plc - India
- Orica Australia Pty. Ltd.
- Sical Logistics Limited - India
- Minerals Council of Australia
- Vijayanagar Sugar Pvt Ltd - India
- Straits Asia Resources Limited - Singapore
- Holcim Trading Pte Ltd - Singapore
- Borneo Indobara - Indonesia
- Indogreen Group - Indonesia
- Meralco Power Generation, Philippines
- Chettinad Cement Corporation Ltd - India
- PetroVietnam Power Coal Import and Supply Company
- Vizag Seaport Private Limited - India
- White Energy Company Limited
- Planning Commission, India
- Larsen & Toubro Limited - India
- Central Java Power - Indonesia
- The State Trading Corporation of India Ltd
- Barasentosa Lestari - Indonesia
- Orica Mining Services - Indonesia
- ICICI Bank Limited - India
- Electricity Generating Authority of Thailand
- TNB Fuel Sdn Bhd - Malaysia
- Standard Chartered Bank - UAE
- GN Power Mariveles Coal Plant, Philippines
- European Bulk Services B.V. - Netherlands
- Global Coal Blending Company Limited - Australia
- Ambuja Cements Ltd - India
- Economic Council, Georgia
- Madhucon Powers Ltd - India
- Mercator Lines Limited - India
- Sindya Power Generating Company Private Ltd
- Makarim & Taira - Indonesia
- Indika Energy - Indonesia
- Global Business Power Corporation, Philippines
- Rio Tinto Coal - Australia
- Salva Resources Pvt Ltd - India
- Bhushan Steel Limited - India
- Georgia Ports Authority, United States
- Petron Corporation, Philippines
- Marubeni Corporation - India
- Essar Steel Hazira Ltd - India
- Coal and Oil Company - UAE
- Maharashtra Electricity Regulatory Commission - India
- Interocean Group of Companies - India
- Ceylon Electricity Board - Sri Lanka
- Globalindo Alam Lestari - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Simpson Spence & Young - Indonesia
- Gujarat Sidhee Cement - India
- Coalindo Energy - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Indo Tambangraya Megah - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Carbofer General Trading SA - India
- Bayan Resources Tbk. - Indonesia
- Tamil Nadu electricity Board
- Malabar Cements Ltd - India
- Sarangani Energy Corporation, Philippines
- Price Waterhouse Coopers - Russia
- Africa Commodities Group - South Africa
- Rashtriya Ispat Nigam Limited - India
- Kumho Petrochemical, South Korea
- AsiaOL BioFuels Corp., Philippines
- Siam City Cement PLC, Thailand
- South Luzon Thermal Energy Corporation
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