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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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Monday, 08 January 24
KOSPO TO BUY 80000 MT OF INDONESIAN LOW CALORIFIC VALUE COAL FOR FEB 2024
Korea Southern Power Co., Ltd. (KOSPO), is inviting bids for the supply of Indonesian Low Calorific Value Coal from qualified suppliers for Korean ...
Monday, 08 January 24
SEABORNE TRADE REACHES 12.4BN TONNES - CLARKSONS
China will establish a back-up coal production system by 2027 to stabilise prices and secure coal supply, the state planner said on Wednesday, even ...
Monday, 08 January 24
CAPESIZES START THE NEW YEAR ON POSITIVE NOTE - BALTIC EXCHANGE
Capesize
This week the capsize market has been marked by a mix of activities and challenges. Despite a slow start following the Christmas and N ...
Friday, 05 January 24
MORGAN STANLEY SEES LOWER OIL PRICES IN 2024 ON OVERSUPPLY CONCERNS - REUTERS
Morgan Stanley sees Brent crude prices anchored near $80 per barrel in the first half in 2024 before declining towards the end of the year as it ex ...
Friday, 05 January 24
INDIA'S COAL OUTPUT RISES NEARLY 11 PC IN DEC TO 92.87 MT - PTI
India’s coal production increased by 10.75 per cent to 92.87 million tonne in December 2023 as compared to the year-ago period, an official s ...
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- Electricity Authority, New Zealand
- Borneo Indobara - Indonesia
- Rashtriya Ispat Nigam Limited - India
- Anglo American - United Kingdom
- Jaiprakash Power Ventures ltd
- European Bulk Services B.V. - Netherlands
- Central Java Power - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Bukit Makmur.PT - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Mercator Lines Limited - India
- Iligan Light & Power Inc, Philippines
- Miang Besar Coal Terminal - Indonesia
- Ind-Barath Power Infra Limited - India
- Gujarat Electricity Regulatory Commission - India
- International Coal Ventures Pvt Ltd - India
- Chamber of Mines of South Africa
- Deloitte Consulting - India
- Indo Tambangraya Megah - Indonesia
- New Zealand Coal & Carbon
- Mercuria Energy - Indonesia
- Independent Power Producers Association of India
- Grasim Industreis Ltd - India
- Globalindo Alam Lestari - Indonesia
- Electricity Generating Authority of Thailand
- Sarangani Energy Corporation, Philippines
- Kohat Cement Company Ltd. - Pakistan
- SN Aboitiz Power Inc, Philippines
- Kideco Jaya Agung - Indonesia
- Kobexindo Tractors - Indoneisa
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Madhucon Powers Ltd - India
- Jindal Steel & Power Ltd - India
- Australian Commodity Traders Exchange
- Bhushan Steel Limited - India
- Baramulti Group, Indonesia
- Kumho Petrochemical, South Korea
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Meralco Power Generation, Philippines
- Kapuas Tunggal Persada - Indonesia
- Wood Mackenzie - Singapore
- Siam City Cement PLC, Thailand
- Heidelberg Cement - Germany
- Commonwealth Bank - Australia
- Sree Jayajothi Cements Limited - India
- Larsen & Toubro Limited - India
- Attock Cement Pakistan Limited
- Eastern Coal Council - USA
- Merrill Lynch Commodities Europe
- Tata Chemicals Ltd - India
- Trasteel International SA, Italy
- Australian Coal Association
- Singapore Mercantile Exchange
- Price Waterhouse Coopers - Russia
- Bulk Trading Sa - Switzerland
- Indonesian Coal Mining Association
- OPG Power Generation Pvt Ltd - India
- Global Coal Blending Company Limited - Australia
- Bayan Resources Tbk. - Indonesia
- Ministry of Finance - Indonesia
- Tamil Nadu electricity Board
- Altura Mining Limited, Indonesia
- Rio Tinto Coal - Australia
- Energy Link Ltd, New Zealand
- Coal and Oil Company - UAE
- Intertek Mineral Services - Indonesia
- Aditya Birla Group - India
- Timah Investasi Mineral - Indoneisa
- Oldendorff Carriers - Singapore
- Standard Chartered Bank - UAE
- Billiton Holdings Pty Ltd - Australia
- Semirara Mining and Power Corporation, Philippines
- Meenaskhi Energy Private Limited - India
- Posco Energy - South Korea
- Maharashtra Electricity Regulatory Commission - India
- Edison Trading Spa - Italy
- Indika Energy - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Asmin Koalindo Tuhup - Indonesia
- Kaltim Prima Coal - Indonesia
- Orica Australia Pty. Ltd.
- CNBM International Corporation - China
- MS Steel International - UAE
- Jorong Barutama Greston.PT - Indonesia
- Medco Energi Mining Internasional
- Makarim & Taira - Indonesia
- ICICI Bank Limited - India
- Global Green Power PLC Corporation, Philippines
- Toyota Tsusho Corporation, Japan
- Indian Oil Corporation Limited
- Mintek Dendrill Indonesia
- Carbofer General Trading SA - India
- Eastern Energy - Thailand
- Neyveli Lignite Corporation Ltd, - India
- IHS Mccloskey Coal Group - USA
- Vizag Seaport Private Limited - India
- PowerSource Philippines DevCo
- Latin American Coal - Colombia
- Straits Asia Resources Limited - Singapore
- GAC Shipping (India) Pvt Ltd
- Offshore Bulk Terminal Pte Ltd, Singapore
- LBH Netherlands Bv - Netherlands
- Malabar Cements Ltd - India
- Krishnapatnam Port Company Ltd. - India
- Bhatia International Limited - India
- Parliament of New Zealand
- The Treasury - Australian Government
- Formosa Plastics Group - Taiwan
- Cigading International Bulk Terminal - Indonesia
- Economic Council, Georgia
- Romanian Commodities Exchange
- Interocean Group of Companies - India
- Maheswari Brothers Coal Limited - India
- Pendopo Energi Batubara - Indonesia
- Orica Mining Services - Indonesia
- Kartika Selabumi Mining - Indonesia
- Manunggal Multi Energi - Indonesia
- Agrawal Coal Company - India
- Bukit Asam (Persero) Tbk - Indonesia
- Ambuja Cements Ltd - India
- CIMB Investment Bank - Malaysia
- Marubeni Corporation - India
- Directorate Of Revenue Intelligence - India
- Alfred C Toepfer International GmbH - Germany
- Indian Energy Exchange, India
- PetroVietnam Power Coal Import and Supply Company
- Kalimantan Lumbung Energi - Indonesia
- Videocon Industries ltd - India
- Savvy Resources Ltd - HongKong
- Semirara Mining Corp, Philippines
- Indogreen Group - Indonesia
- AsiaOL BioFuels Corp., Philippines
- Mjunction Services Limited - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- The University of Queensland
- Thiess Contractors Indonesia
- Leighton Contractors Pty Ltd - Australia
- VISA Power Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Ceylon Electricity Board - Sri Lanka
- Bank of Tokyo Mitsubishi UFJ Ltd
- Vijayanagar Sugar Pvt Ltd - India
- Global Business Power Corporation, Philippines
- Ministry of Transport, Egypt
- Chettinad Cement Corporation Ltd - India
- TeaM Sual Corporation - Philippines
- Sojitz Corporation - Japan
- Sical Logistics Limited - India
- Planning Commission, India
- Bangladesh Power Developement Board
- Star Paper Mills Limited - India
- Africa Commodities Group - South Africa
- SMG Consultants - Indonesia
- Riau Bara Harum - Indonesia
- Uttam Galva Steels Limited - India
- London Commodity Brokers - England
- Barasentosa Lestari - Indonesia
- Sakthi Sugars Limited - India
- Bhoruka Overseas - Indonesia
- Coalindo Energy - Indonesia
- Metalloyd Limited - United Kingdom
- Sindya Power Generating Company Private Ltd
- Essar Steel Hazira Ltd - India
- Vedanta Resources Plc - India
- Thai Mozambique Logistica
- Samtan Co., Ltd - South Korea
- Renaissance Capital - South Africa
- SMC Global Power, Philippines
- Therma Luzon, Inc, Philippines
- Banpu Public Company Limited - Thailand
- Binh Thuan Hamico - Vietnam
- Aboitiz Power Corporation - Philippines
- Sinarmas Energy and Mining - Indonesia
- Power Finance Corporation Ltd., India
- Ministry of Mines - Canada
- Dalmia Cement Bharat India
- Pipit Mutiara Jaya. PT, Indonesia
- Goldman Sachs - Singapore
- IEA Clean Coal Centre - UK
- Port Waratah Coal Services - Australia
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Kepco SPC Power Corporation, Philippines
- Salva Resources Pvt Ltd - India
- Central Electricity Authority - India
- Holcim Trading Pte Ltd - Singapore
- Energy Development Corp, Philippines
- Directorate General of MIneral and Coal - Indonesia
- Cement Manufacturers Association - India
- Georgia Ports Authority, United States
- Karbindo Abesyapradhi - Indoneisa
- McConnell Dowell - Australia
- Siam City Cement - Thailand
- Wilmar Investment Holdings
- TNB Fuel Sdn Bhd - Malaysia
- South Luzon Thermal Energy Corporation
- GVK Power & Infra Limited - India
- Coastal Gujarat Power Limited - India
- Karaikal Port Pvt Ltd - India
- PTC India Limited - India
- Minerals Council of Australia
- Xindia Steels Limited - India
- ASAPP Information Group - India
- San Jose City I Power Corp, Philippines
- Bharathi Cement Corporation - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- GMR Energy Limited - India
- Gujarat Sidhee Cement - India
- The State Trading Corporation of India Ltd
- PNOC Exploration Corporation - Philippines
- Antam Resourcindo - Indonesia
- Lanco Infratech Ltd - India
- Parry Sugars Refinery, India
- India Bulls Power Limited - India
- Simpson Spence & Young - Indonesia
- White Energy Company Limited
- Bukit Baiduri Energy - Indonesia
- Petron Corporation, Philippines
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