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Wednesday, 10 June 20
OPEC+ CUTS EXTENSION TO ACCELERATE MARKET REBALANCING - FITCH RATINGS
 Fitch Ratings-London-08 June 2020: The OPEC+ agreement to extend by one month record oil production cuts should accelerate market rebalancing, Fitch Ratings says. This is further supported by a commitment to improve compliance from those countries that were unable to reach full conformity with the cuts.
The OPEC+ countries have made radical production cuts in the stress scenario, but it may be more difficult to reach a consensus when the worst of the crisis is over. And it is unclear whether the recovery in oil prices to date is sustainable. Furthermore, demand and production in non-OPEC+ countries, notably the US, will continue to have a significant impact on the supply-demand balance and prices. We believe that a normalisation of oil inventory built up in 1H20 will take at least several months.
Crude oil prices rose significantly in May and continued to improve in early June, because the surplus has been reduced materially. A price differential between the physical and financial markets has disappeared, pointing to crude oil market tightening. We believe that a stress case scenario with prices falling significantly below USD30/bbl is now less likely. The market is likely to experience a production deficit in 2H20 due to gradually improving demand and reduced supply.
The OPEC+ cuts were the major contributor to market rebalancing. We estimate that the OPEC+ countries reduced production by around 7.5mmbpd in May compared to March. The cumulative OPEC+ cuts should exceed 9mmbpd in June as Saudi Arabia, Kuwait and UAE have committed to cut an additional 1.1mmbpd, while Iraq and Nigeria, which underperformed in May, have promised to improve compliance in June. A resumption of production in Libya, which is not subject to the OPEC+ deal, may increase supply but should be more than offset by additional cuts elsewhere.
Furthermore, production fell in the US as a result both of shut-ins and reduced drilling activity by almost 2mmbpd at end-May compared to March, while Canada cut around 1mmbpd. The number of active drilling rigs in the US declined by 64% compared to the beginning of the year. Production in North America may continue to shrink for a while, but the pace is likely to decelerate due to increased prices. We believe that at USD30/bbl, many producers should be able to stabilise production, while at USD40/bbl or above some would be tempted to increase output, which could limit price recovery.
Estimates suggest crude oil demand increased in May compared to April, and we believe it will improve further from June due to the gradual lifting of lockdown restrictions. Implied oil products consumption in the US improved from a 28% drop in April yoy to a 20% drop in May, driven mainly by increased gasoline consumption (a yoy decline of 25% in May compared to a 44% decline in April), while the consumption of jet fuel remained flat. We believe consumption patterns are similar in Europe, while demand in China bottomed out in February.
Demand recovery is now key in achieving balance in the oil market. It could be undermined in the event of a second coronavirus wave and the re-introduction of lockdowns, although it is not our base case. While consumption of gasoline and diesel could recover by the year-end, jet fuel may lag behind as international travel restrictions may remain in place and demand for business travel may be structurally impaired.
Our ratings are informed by companies’ projected performance at end-2021, rather than in 2020, provided their liquidity is adequate, as we rate “through the cycle”. While we may recalibrate our near-term oil price assumptions to the pace of market rebalancing, our ratings already assume that the market will recover gradually; therefore the most recent improvements will not prompt portfolio-wide rating actions.
Source: Fitch Ratings
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Wednesday, 17 June 20
MARKET INSIGHT - INTERMODAL
After experiencing record earnings during the first half of the year, the focus of headlines concerning the tanker market has shifted from the deve ...
Wednesday, 17 June 20
KOREA SOUTHERN POWER CO INVITED 80000 MT OF LOW CALORIFIC VALUE COAL FOR AUGUST 1H, 2020 LOADING
COALspot.com: Korea Southern Power Co., Ltd. (KOSPO) has issued an International tender for 80,000 Metric Tons (MT) Min 4,200 kcal/kg - Max. ...
Tuesday, 16 June 20
A GLOBAL ECONOMIC SLUMP: WHAT WILL IT MEAN FOR METALS AND MINING? - WOOD MACKENZIE
Back before coronavirus knocked “normal” out cold, the key issues for miners were sub-investment prices, rising requirements for ESG an ...
Tuesday, 16 June 20
CHINA TAIYUAN COAL TRANSACTION PRICE INDEX UP 0.58 PCT - XINHUA
China Taiyuan coal transaction price index stood at 124.43 points Monday, up 0.58 percent week on week.
The index, released by China ...
Tuesday, 16 June 20
HIGHER IRON ORE PRICES OFFSET CORONAVIRUS-DRIVEN PRODUCTION RISK - FITCH RATINGS
Lower iron ore production in Brazil, resulting from rising coronavirus infections, should only marginally affect the cash flow of Vale and other gl ...
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Showing 906 to 910 news of total 6871 |
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- Minerals Council of Australia
- Indika Energy - Indonesia
- Ambuja Cements Ltd - India
- Globalindo Alam Lestari - Indonesia
- India Bulls Power Limited - India
- SMG Consultants - Indonesia
- Baramulti Group, Indonesia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Indonesian Coal Mining Association
- LBH Netherlands Bv - Netherlands
- Merrill Lynch Commodities Europe
- Kartika Selabumi Mining - Indonesia
- Siam City Cement - Thailand
- Miang Besar Coal Terminal - Indonesia
- Parry Sugars Refinery, India
- Central Electricity Authority - India
- Thai Mozambique Logistica
- Offshore Bulk Terminal Pte Ltd, Singapore
- Sindya Power Generating Company Private Ltd
- Uttam Galva Steels Limited - India
- Binh Thuan Hamico - Vietnam
- Interocean Group of Companies - India
- Mjunction Services Limited - India
- Sojitz Corporation - Japan
- Attock Cement Pakistan Limited
- Indian Oil Corporation Limited
- Wilmar Investment Holdings
- Bayan Resources Tbk. - Indonesia
- Vijayanagar Sugar Pvt Ltd - India
- Gujarat Mineral Development Corp Ltd - India
- Orica Australia Pty. Ltd.
- Bharathi Cement Corporation - India
- Coastal Gujarat Power Limited - India
- Banpu Public Company Limited - Thailand
- Romanian Commodities Exchange
- IEA Clean Coal Centre - UK
- Kepco SPC Power Corporation, Philippines
- MS Steel International - UAE
- Singapore Mercantile Exchange
- SMC Global Power, Philippines
- TNB Fuel Sdn Bhd - Malaysia
- White Energy Company Limited
- Latin American Coal - Colombia
- Jaiprakash Power Ventures ltd
- Australian Commodity Traders Exchange
- Global Green Power PLC Corporation, Philippines
- Agrawal Coal Company - India
- Goldman Sachs - Singapore
- Ind-Barath Power Infra Limited - India
- Carbofer General Trading SA - India
- PTC India Limited - India
- Directorate Of Revenue Intelligence - India
- Aditya Birla Group - India
- Metalloyd Limited - United Kingdom
- Lanco Infratech Ltd - India
- Meenaskhi Energy Private Limited - India
- GMR Energy Limited - India
- PetroVietnam Power Coal Import and Supply Company
- GN Power Mariveles Coal Plant, Philippines
- Leighton Contractors Pty Ltd - Australia
- Planning Commission, India
- Essar Steel Hazira Ltd - India
- Therma Luzon, Inc, Philippines
- Global Coal Blending Company Limited - Australia
- Neyveli Lignite Corporation Ltd, - India
- Kideco Jaya Agung - Indonesia
- Salva Resources Pvt Ltd - India
- Australian Coal Association
- Bulk Trading Sa - Switzerland
- Chettinad Cement Corporation Ltd - India
- Chamber of Mines of South Africa
- Siam City Cement PLC, Thailand
- Madhucon Powers Ltd - India
- Bhushan Steel Limited - India
- Holcim Trading Pte Ltd - Singapore
- Pipit Mutiara Jaya. PT, Indonesia
- ASAPP Information Group - India
- London Commodity Brokers - England
- Karaikal Port Pvt Ltd - India
- Heidelberg Cement - Germany
- Semirara Mining and Power Corporation, Philippines
- GVK Power & Infra Limited - India
- Malabar Cements Ltd - India
- Economic Council, Georgia
- Africa Commodities Group - South Africa
- Electricity Generating Authority of Thailand
- IHS Mccloskey Coal Group - USA
- Ministry of Finance - Indonesia
- Directorate General of MIneral and Coal - Indonesia
- Cement Manufacturers Association - India
- Coal and Oil Company - UAE
- Bhatia International Limited - India
- Georgia Ports Authority, United States
- Orica Mining Services - Indonesia
- Bukit Baiduri Energy - Indonesia
- Tamil Nadu electricity Board
- Antam Resourcindo - Indonesia
- Maheswari Brothers Coal Limited - India
- San Jose City I Power Corp, Philippines
- Pendopo Energi Batubara - Indonesia
- Petron Corporation, Philippines
- Ministry of Mines - Canada
- Kumho Petrochemical, South Korea
- Jorong Barutama Greston.PT - Indonesia
- Thiess Contractors Indonesia
- Iligan Light & Power Inc, Philippines
- Toyota Tsusho Corporation, Japan
- Deloitte Consulting - India
- The State Trading Corporation of India Ltd
- Energy Link Ltd, New Zealand
- Bukit Makmur.PT - Indonesia
- Eastern Energy - Thailand
- Indo Tambangraya Megah - Indonesia
- New Zealand Coal & Carbon
- European Bulk Services B.V. - Netherlands
- Petrochimia International Co. Ltd.- Taiwan
- Bangladesh Power Developement Board
- Power Finance Corporation Ltd., India
- Barasentosa Lestari - Indonesia
- Sree Jayajothi Cements Limited - India
- South Luzon Thermal Energy Corporation
- Eastern Coal Council - USA
- Mercator Lines Limited - India
- Posco Energy - South Korea
- ICICI Bank Limited - India
- Makarim & Taira - Indonesia
- Savvy Resources Ltd - HongKong
- International Coal Ventures Pvt Ltd - India
- Indogreen Group - Indonesia
- Oldendorff Carriers - Singapore
- OPG Power Generation Pvt Ltd - India
- Xindia Steels Limited - India
- Coalindo Energy - Indonesia
- Vedanta Resources Plc - India
- Wood Mackenzie - Singapore
- Riau Bara Harum - Indonesia
- Standard Chartered Bank - UAE
- Semirara Mining Corp, Philippines
- Sarangani Energy Corporation, Philippines
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Sical Logistics Limited - India
- Trasteel International SA, Italy
- Samtan Co., Ltd - South Korea
- Manunggal Multi Energi - Indonesia
- Tata Chemicals Ltd - India
- Sakthi Sugars Limited - India
- Mintek Dendrill Indonesia
- Kaltim Prima Coal - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Alfred C Toepfer International GmbH - Germany
- Price Waterhouse Coopers - Russia
- Straits Asia Resources Limited - Singapore
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Borneo Indobara - Indonesia
- Renaissance Capital - South Africa
- Krishnapatnam Port Company Ltd. - India
- Star Paper Mills Limited - India
- Port Waratah Coal Services - Australia
- Videocon Industries ltd - India
- CNBM International Corporation - China
- Mercuria Energy - Indonesia
- Bhoruka Overseas - Indonesia
- Energy Development Corp, Philippines
- Global Business Power Corporation, Philippines
- SN Aboitiz Power Inc, Philippines
- GAC Shipping (India) Pvt Ltd
- Kobexindo Tractors - Indoneisa
- Indian Energy Exchange, India
- Cigading International Bulk Terminal - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Maharashtra Electricity Regulatory Commission - India
- Bahari Cakrawala Sebuku - Indonesia
- Vizag Seaport Private Limited - India
- McConnell Dowell - Australia
- Ceylon Electricity Board - Sri Lanka
- VISA Power Limited - India
- Gujarat Sidhee Cement - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Asmin Koalindo Tuhup - Indonesia
- Asia Pacific Energy Resources Ventures Inc, Philippines
- AsiaOL BioFuels Corp., Philippines
- Karbindo Abesyapradhi - Indoneisa
- Bank of Tokyo Mitsubishi UFJ Ltd
- Electricity Authority, New Zealand
- Ministry of Transport, Egypt
- Independent Power Producers Association of India
- Commonwealth Bank - Australia
- Formosa Plastics Group - Taiwan
- Aboitiz Power Corporation - Philippines
- CIMB Investment Bank - Malaysia
- Altura Mining Limited, Indonesia
- Kalimantan Lumbung Energi - Indonesia
- Edison Trading Spa - Italy
- The University of Queensland
- Rashtriya Ispat Nigam Limited - India
- Central Java Power - Indonesia
- Timah Investasi Mineral - Indoneisa
- Gujarat Electricity Regulatory Commission - India
- Jindal Steel & Power Ltd - India
- Sinarmas Energy and Mining - Indonesia
- Meralco Power Generation, Philippines
- Intertek Mineral Services - Indonesia
- Marubeni Corporation - India
- The Treasury - Australian Government
- Parliament of New Zealand
- Dalmia Cement Bharat India
- PNOC Exploration Corporation - Philippines
- Bukit Asam (Persero) Tbk - Indonesia
- Grasim Industreis Ltd - India
- Rio Tinto Coal - Australia
- Larsen & Toubro Limited - India
- Anglo American - United Kingdom
- Simpson Spence & Young - Indonesia
- TeaM Sual Corporation - Philippines
- Medco Energi Mining Internasional
- PowerSource Philippines DevCo
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