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Saturday, 20 June 20
WORLD OIL DEMAND IS PROJECTED TO DECREASE BY 9.1 MB/D IN 2020 - OPEC
Crude Oil Price Movements
Spot crude oil prices rebounded in May from low levels registered a month earlier, as physical market fundamentals improved significantly. The OPEC Reference Basket (ORB) value rose by $7.51, or 42.5%, m-o-m, to stand at $25.17/b. Crude oil futures prices also bounced back in May, amid renewed optimism on the outlook of global oil market fundamentals and expectations for a further recovery of oil demand and tightening global supply. ICE Brent increased by $5.78, or 21.7%, m-o-m to average $32.41/b, and NYMEX WTI soared by $11.83, or 70.8%, m-o-m to average $28.53/b. The contango structure of oil futures prices flattened considerably over the month in all three markets, suggesting that the supply-demand fundamentals are gradually improving. Hedge funds and other money managers turned more positive about the outlook for crude oil prices and continued to raise their combined futures and options net long positions in both ICE Brent and NYMEX WTI contracts.
World Economy
The world economic growth forecast remains unchanged, declining by 3.4% y-o-y in 2020, following global economic growth of 2.9% in 2019. The major economies’ forecasts remain unchanged this month, except for India. The US is forecast to contract by 5.2% in 2020, following growth of 2.3% in 2019. An even larger decline of 8.0% is expected in the Euro-zone in 2020, compared to growth of 1.2% in 2019. Japan is forecast to contract by 5.1% in 2020, comparing to growth of 0.7% in 2019. China’s 2020 GDP is forecast to grow by 1.3%, following growth of 6.1% in 2019. India’s forecast was revised down to decline by 0.8%, a sharp slowdown from downwardly revised growth of 4.9% in 2019. Brazil’s economy is forecast to contract by 6.0% in 2020, following growth of 1.1% in 2019. Russia’s economy is forecast to contract by 4.5% in 2020, after growth of 1.3% in 2019, not only due to COVID-19, but also because of the considerable decline in oil prices.
World Oil Demand
World oil demand is projected to decrease by 9.1 mb/d in 2020, unchanged from the previous month’s assessment. The COVID-19 pandemic has negatively affected global economic activities, eliminating global oil demand growth potential and leading to a y-o-y decline of 6.4 mb/d in 1Q20 and by 17.3 mb/d y-o-y in 2Q20. Transportation fuels are projected to be under pressure during 2020 as lockdowns in various countries particularly the US, Europe, India and the Middle East reduce demand for gasoline and jet fuel, as air travel and distances travelled anticipated to significantly decline compared with a year earlier. Furthermore, decreased manufacturing activities, compared with the previous year, will limit industrial fuel requirements. Petrochemical feedstock is expected to be driven by slower end-user requirements for plastics and plastic products, compared to previous years. Considering the large uncertainties going forward, new data and developments may warrant further revisions in the near term. For 2019, world oil demand growth is kept unchanged at 0.83 mb/d as OECD oil demand declined by 0.10 mb/d while non-OECD oil demand increased by 0.93 mb/d.
World Oil Supply
Non-OPEC liquids production growth in 2020 (including processing gains) is revised up by 0.3 mb/d from the previous month’s assessment and is now forecast to decline by 3.2 mb/d y-o-y. The revision is based on oil production estimations for April and May in non-OPEC countries participating in Declaration of Cooperation (DoC). Strong conformity with the voluntary production adjustments by the 10 non-OPEC participating countries in the DoC led to a drop in crude oil output of more than 2.59 mb/d in May, while OPEC-10 cut 6.25 mb/d m-o-m. At the same time, preliminary oil production outside the DoC showed a decrease by 2.0 mb/d in April and furthermore by 0.8 mb/d in May, mainly in the US and Canada. Oil supply in 2020 is forecast to show growth only in Norway, Brazil, Guyana and Australia. Non-OPEC liquids production growth in 2019 was revised up by 0.01 mb/d owing to a minor upward revision in Latin America’s production in 4Q19 and is now estimated to have grown by 2.03 mb/d to average 65.03 mb/d for the year. OPEC NGLs are estimated to have declined by 0.08 mb/d y-o-y in 2019 to average 5.26 mb/d, while the preliminary 2020 forecast indicates a decline of 0.03 mb/d to average 5.23 mb/d. OPEC crude oil production in May decreased by 6.30 tb/d m-o-m to average 24.19 mb/d, according to secondary sources.
Product Markets and Refining Operations
Refinery margins globally came under heavy pressure and plummeted to record lows on the back of oil product gluts amid stronger feedstock prices. The middle section of the barrel suffered the most as the manufacturing, freight and distribution systems still operate at reduced rates. Although gasoline markets showed some upside, owing to a gradual recovery in mobility as the pandemic restrictions continue to be eased, this was insufficient to prevent the hard downfall in refining economics.
Tanker Market
Dirty tanker rates in May fell from the high levels seen since mid-March. Production adjustments by OPEC and participating non-OPEC countries, as well as other major producers have eased the pressure seen on demand for VLCCs. A decline in product exports amid COVID-19 lockdowns have also kept clean tanker rates subdued, with both reduced refinery runs and weak product demand limiting cargoes. Floating storage has provided some support to both dirty and clean rates, however, levels are seen to be unwinding faster-than-expected.
Crude and Refined Products Trade
Preliminary data for May shows US crude imports recovering slightly to 6.0 mb/d following the arrival of long-haul volumes from the Middle East. US crude exports remained broadly steady at 3.2 mb/d, although a considerable share was headed to floating storage and oversea inventories. Product exports fell sharply in May, accelerating the decline that started in March, as COVID-19 disruptions constricted product demand in Latin America. After bottoming out at 9.7 mb/d in March, China’s crude imports picked up in April, averaging 9.9 mb/d. Preliminary customs data indicates crude imports hit a new record high of 11.3 mb/d in May. Product exports from China reached a new record high of 2.08 mb/d in April, although tanker tracking data points to a sharp fall in exports in the coming months. India’s crude imports dipped in April to average 4.2 mb/d, impacted by the government-ordered lockdown over the month. India’s product imports experienced a continued decline, weighed down by similar factors, averaging below 1.0 mb/d for the first time this year. India’s product exports edged slightly higher in April, as refiners looked to international markets to drain excessively high inventories.
Commercial Stock Movements
Preliminary April data showed that total OECD commercial oil stocks rose by 107.7 mb m-o-m to stand at 3,069 mb. This is 184 mb higher than the same time one year ago and 140.6 mb above the latest five-year average. Within the components, crude and products stocks rose by 58.1 mb and 49.6 mb m-o-m, respectively. OECD crude stocks stood at 57.9 mb above the latest five-year average, while product stocks exhibited a surplus of 82.6 mb compared to the latest five-year average. In terms of days of forward cover, OECD commercial stocks fell by 4.2 days m-o-m in April to stand at 80.7 days. This is 19.9 days above April 2019, and 18.6 days above the latest five-year average.
Balance of Supply and Demand
Demand for OPEC crude in 2019 is revised down by 0.5 mb/d from the previous assessment, standing at 29.4 mb/d, which is 1.1 mb/d lower than the 2018 level. Demand for OPEC crude in 2020 is also revised down by 0.7 mb/d from the previous month, standing at 23.6 mb/d, which is around 5.8 mb/d lower than in the previous year.
Source: OPEC
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Thursday, 27 May 21
KOMIPO INVITED BIDS FOR 1.56 MILLION TONS OF BITUMINOUS COAL
COALspot.com: Korea Midland Power Co., Ltd (KOMIPO) has issued an international tender for total 1,560,000 MT of Bituminous Coal to be used a ...
Thursday, 27 May 21
CHINA POWER DEMAND EXCEEDS PRE-COVID-19 LEVELS; THERMAL OUTPUT STRONG - FITCH RATINGS
Rising Consumption: Total power consumption rose by 21.2% yoy to 1,921.9GWh in 1Q21 due to the fast recovery of China’s economy, after a drop ...
Thursday, 27 May 21
CHINA'S POWER DEMAND EXCEEDS PRE-PANDEMIC LEVELS; RENEWABLES TO DRIVE DEVELOPMENT - FITCH RATINGS
China's power consumption exceeded the pre-Covid-19 levels in 1Q21 due to the country's fast economic recovery, with strong output from the ...
Wednesday, 26 May 21
THE INDONESIA COAL PRICE REFERENCE FOR MAY 2021 SETTLES AT US$ 89.74 PER TON
COALspot.com: The Indonesia coal price reference for May 2021 settles at US$ 89.74 per ton FOB vessel.
The Indonesia coal pric ...
Wednesday, 26 May 21
MARKET INSIGHT - INTERMODAL
Last year crude tankers’ newbuilding contracting activity was devastated by the economic effects of the Covid-19 pandemic and the cloud of un ...
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- Minerals Council of Australia
- Mjunction Services Limited - India
- Intertek Mineral Services - Indonesia
- Interocean Group of Companies - India
- White Energy Company Limited
- Africa Commodities Group - South Africa
- Coastal Gujarat Power Limited - India
- Posco Energy - South Korea
- Merrill Lynch Commodities Europe
- Banpu Public Company Limited - Thailand
- Bukit Asam (Persero) Tbk - Indonesia
- Mintek Dendrill Indonesia
- VISA Power Limited - India
- MS Steel International - UAE
- Iligan Light & Power Inc, Philippines
- Essar Steel Hazira Ltd - India
- Electricity Generating Authority of Thailand
- Kaltim Prima Coal - Indonesia
- Vizag Seaport Private Limited - India
- SN Aboitiz Power Inc, Philippines
- Malabar Cements Ltd - India
- IHS Mccloskey Coal Group - USA
- Toyota Tsusho Corporation, Japan
- TNB Fuel Sdn Bhd - Malaysia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Indian Oil Corporation Limited
- Rashtriya Ispat Nigam Limited - India
- Mercuria Energy - Indonesia
- Bangladesh Power Developement Board
- Billiton Holdings Pty Ltd - Australia
- Cigading International Bulk Terminal - Indonesia
- GVK Power & Infra Limited - India
- McConnell Dowell - Australia
- SMC Global Power, Philippines
- Indonesian Coal Mining Association
- Central Electricity Authority - India
- Leighton Contractors Pty Ltd - Australia
- Neyveli Lignite Corporation Ltd, - India
- LBH Netherlands Bv - Netherlands
- Bank of Tokyo Mitsubishi UFJ Ltd
- Star Paper Mills Limited - India
- Tamil Nadu electricity Board
- Indogreen Group - Indonesia
- Ministry of Transport, Egypt
- Sojitz Corporation - Japan
- Wilmar Investment Holdings
- Carbofer General Trading SA - India
- Kartika Selabumi Mining - Indonesia
- Bukit Makmur.PT - Indonesia
- Dalmia Cement Bharat India
- Barasentosa Lestari - Indonesia
- Power Finance Corporation Ltd., India
- CIMB Investment Bank - Malaysia
- Chamber of Mines of South Africa
- Simpson Spence & Young - Indonesia
- GMR Energy Limited - India
- Deloitte Consulting - India
- Kohat Cement Company Ltd. - Pakistan
- Central Java Power - Indonesia
- Planning Commission, India
- Pendopo Energi Batubara - Indonesia
- Savvy Resources Ltd - HongKong
- CNBM International Corporation - China
- European Bulk Services B.V. - Netherlands
- Global Green Power PLC Corporation, Philippines
- Sindya Power Generating Company Private Ltd
- Global Coal Blending Company Limited - Australia
- Directorate Of Revenue Intelligence - India
- Bayan Resources Tbk. - Indonesia
- IEA Clean Coal Centre - UK
- New Zealand Coal & Carbon
- London Commodity Brokers - England
- Wood Mackenzie - Singapore
- Parry Sugars Refinery, India
- Directorate General of MIneral and Coal - Indonesia
- Standard Chartered Bank - UAE
- Energy Link Ltd, New Zealand
- The Treasury - Australian Government
- Xindia Steels Limited - India
- Ambuja Cements Ltd - India
- Indika Energy - Indonesia
- Australian Commodity Traders Exchange
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- GAC Shipping (India) Pvt Ltd
- Jaiprakash Power Ventures ltd
- Singapore Mercantile Exchange
- Medco Energi Mining Internasional
- The State Trading Corporation of India Ltd
- Karaikal Port Pvt Ltd - India
- Renaissance Capital - South Africa
- Electricity Authority, New Zealand
- Alfred C Toepfer International GmbH - Germany
- Timah Investasi Mineral - Indoneisa
- Maheswari Brothers Coal Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Kalimantan Lumbung Energi - Indonesia
- Antam Resourcindo - Indonesia
- Marubeni Corporation - India
- Price Waterhouse Coopers - Russia
- Energy Development Corp, Philippines
- Makarim & Taira - Indonesia
- TeaM Sual Corporation - Philippines
- Vijayanagar Sugar Pvt Ltd - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Grasim Industreis Ltd - India
- Bharathi Cement Corporation - India
- Sinarmas Energy and Mining - Indonesia
- Karbindo Abesyapradhi - Indoneisa
- Salva Resources Pvt Ltd - India
- Sree Jayajothi Cements Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Asmin Koalindo Tuhup - Indonesia
- Oldendorff Carriers - Singapore
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Thai Mozambique Logistica
- Sakthi Sugars Limited - India
- PetroVietnam Power Coal Import and Supply Company
- Samtan Co., Ltd - South Korea
- Semirara Mining Corp, Philippines
- Coal and Oil Company - UAE
- South Luzon Thermal Energy Corporation
- Rio Tinto Coal - Australia
- Riau Bara Harum - Indonesia
- Formosa Plastics Group - Taiwan
- International Coal Ventures Pvt Ltd - India
- Madhucon Powers Ltd - India
- Larsen & Toubro Limited - India
- Borneo Indobara - Indonesia
- Baramulti Group, Indonesia
- Lanco Infratech Ltd - India
- Bulk Trading Sa - Switzerland
- SMG Consultants - Indonesia
- Sical Logistics Limited - India
- Siam City Cement - Thailand
- Ind-Barath Power Infra Limited - India
- Bahari Cakrawala Sebuku - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Edison Trading Spa - Italy
- Sarangani Energy Corporation, Philippines
- Metalloyd Limited - United Kingdom
- AsiaOL BioFuels Corp., Philippines
- GN Power Mariveles Coal Plant, Philippines
- ASAPP Information Group - India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Commonwealth Bank - Australia
- Gujarat Sidhee Cement - India
- Pipit Mutiara Jaya. PT, Indonesia
- Videocon Industries ltd - India
- Indian Energy Exchange, India
- Therma Luzon, Inc, Philippines
- Ministry of Finance - Indonesia
- Aditya Birla Group - India
- Anglo American - United Kingdom
- Krishnapatnam Port Company Ltd. - India
- Meralco Power Generation, Philippines
- Globalindo Alam Lestari - Indonesia
- Eastern Coal Council - USA
- Thiess Contractors Indonesia
- Binh Thuan Hamico - Vietnam
- Australian Coal Association
- Independent Power Producers Association of India
- Kumho Petrochemical, South Korea
- Eastern Energy - Thailand
- Siam City Cement PLC, Thailand
- Aboitiz Power Corporation - Philippines
- Miang Besar Coal Terminal - Indonesia
- Jindal Steel & Power Ltd - India
- Attock Cement Pakistan Limited
- Georgia Ports Authority, United States
- Kideco Jaya Agung - Indonesia
- Kepco SPC Power Corporation, Philippines
- ICICI Bank Limited - India
- Kobexindo Tractors - Indoneisa
- Indo Tambangraya Megah - Indonesia
- Semirara Mining and Power Corporation, Philippines
- Maharashtra Electricity Regulatory Commission - India
- Heidelberg Cement - Germany
- Chettinad Cement Corporation Ltd - India
- Ceylon Electricity Board - Sri Lanka
- Gujarat Mineral Development Corp Ltd - India
- Port Waratah Coal Services - Australia
- Petron Corporation, Philippines
- Orica Mining Services - Indonesia
- Romanian Commodities Exchange
- Vedanta Resources Plc - India
- Agrawal Coal Company - India
- Tata Chemicals Ltd - India
- Gujarat Electricity Regulatory Commission - India
- Global Business Power Corporation, Philippines
- Trasteel International SA, Italy
- Altura Mining Limited, Indonesia
- Mercator Lines Limited - India
- Manunggal Multi Energi - Indonesia
- Bhatia International Limited - India
- Ministry of Mines - Canada
- Cement Manufacturers Association - India
- Coalindo Energy - Indonesia
- San Jose City I Power Corp, Philippines
- Uttam Galva Steels Limited - India
- The University of Queensland
- OPG Power Generation Pvt Ltd - India
- Goldman Sachs - Singapore
- Bhoruka Overseas - Indonesia
- Economic Council, Georgia
- India Bulls Power Limited - India
- PNOC Exploration Corporation - Philippines
- Kapuas Tunggal Persada - Indonesia
- Meenaskhi Energy Private Limited - India
- PTC India Limited - India
- Bukit Baiduri Energy - Indonesia
- Orica Australia Pty. Ltd.
- Jorong Barutama Greston.PT - Indonesia
- Latin American Coal - Colombia
- Straits Asia Resources Limited - Singapore
- Bhushan Steel Limited - India
- Parliament of New Zealand
- PowerSource Philippines DevCo
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