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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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Tuesday, 08 December 20
MARKET ANALYSIS - ALLIED SHIPPING
It is now undisputed that oil consumption for 2020 will post a considerable drop, as demand for several petroleum products has plummeted since the ...
Tuesday, 08 December 20
PANAMAX: THE OVERALL MARKET SEEMS TO BE UNDER NEGATIVE PRESSURE - ALLIED
Capesize
A rather indifferent week for the Capesize market, with BCI 5TC figure finishing the week with slight losses of 0.8%. The Atlantic enj ...
Friday, 04 December 20
CHINA'S BENCHMARK POWER COAL PRICE EDGES UP - XINHUA
China’s benchmark power coal price rose slightly during the past week.
The Bohai-Rim Steam-Coal Price Index (BSPI), a gauge of ...
Friday, 04 December 20
THE INDONESIA COAL PRICE REFERENCE REACHES THREE MONTH HIGH ON IMPROVING DEMAND OUTLOOK
COALspot.com: The Indonesia Coal Price Reference reaches three month high on improving demand outlook . The Indonesia Coal Price Reference rose by& ...
Wednesday, 02 December 20
GLOBAL MINING SECTOR OUTLOOK STABLE DUE TO CHINA'S RECOVERY - FITCH RATINGS
China’s post-pandemic economic recovery and sizeable infrastructure-focused government stimulus boosted global metals and mining prices, help ...
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- Samtan Co., Ltd - South Korea
- Maharashtra Electricity Regulatory Commission - India
- Agrawal Coal Company - India
- New Zealand Coal & Carbon
- Gujarat Sidhee Cement - India
- Kideco Jaya Agung - Indonesia
- Petron Corporation, Philippines
- Price Waterhouse Coopers - Russia
- Formosa Plastics Group - Taiwan
- Meenaskhi Energy Private Limited - India
- Wood Mackenzie - Singapore
- Global Green Power PLC Corporation, Philippines
- Cigading International Bulk Terminal - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Goldman Sachs - Singapore
- Attock Cement Pakistan Limited
- Mjunction Services Limited - India
- Global Business Power Corporation, Philippines
- Grasim Industreis Ltd - India
- Bhoruka Overseas - Indonesia
- London Commodity Brokers - England
- Cement Manufacturers Association - India
- Billiton Holdings Pty Ltd - Australia
- Standard Chartered Bank - UAE
- Kepco SPC Power Corporation, Philippines
- PowerSource Philippines DevCo
- Bank of Tokyo Mitsubishi UFJ Ltd
- PNOC Exploration Corporation - Philippines
- The University of Queensland
- Oldendorff Carriers - Singapore
- Electricity Generating Authority of Thailand
- PTC India Limited - India
- Directorate Of Revenue Intelligence - India
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- Kaltim Prima Coal - Indonesia
- Makarim & Taira - Indonesia
- Sindya Power Generating Company Private Ltd
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- Bukit Baiduri Energy - Indonesia
- LBH Netherlands Bv - Netherlands
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- Coastal Gujarat Power Limited - India
- Tamil Nadu electricity Board
- Georgia Ports Authority, United States
- South Luzon Thermal Energy Corporation
- Savvy Resources Ltd - HongKong
- Essar Steel Hazira Ltd - India
- Coal and Oil Company - UAE
- Jaiprakash Power Ventures ltd
- Ind-Barath Power Infra Limited - India
- Vedanta Resources Plc - India
- Carbofer General Trading SA - India
- Chettinad Cement Corporation Ltd - India
- The Treasury - Australian Government
- TNB Fuel Sdn Bhd - Malaysia
- Xindia Steels Limited - India
- Kumho Petrochemical, South Korea
- Kapuas Tunggal Persada - Indonesia
- White Energy Company Limited
- Gujarat Electricity Regulatory Commission - India
- ASAPP Information Group - India
- Energy Development Corp, Philippines
- Gujarat Mineral Development Corp Ltd - India
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- Salva Resources Pvt Ltd - India
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- Chamber of Mines of South Africa
- Semirara Mining and Power Corporation, Philippines
- Romanian Commodities Exchange
- Leighton Contractors Pty Ltd - Australia
- Thiess Contractors Indonesia
- Miang Besar Coal Terminal - Indonesia
- Renaissance Capital - South Africa
- Maheswari Brothers Coal Limited - India
- Indogreen Group - Indonesia
- Bayan Resources Tbk. - Indonesia
- Bangladesh Power Developement Board
- Directorate General of MIneral and Coal - Indonesia
- Intertek Mineral Services - Indonesia
- SMC Global Power, Philippines
- Manunggal Multi Energi - Indonesia
- Medco Energi Mining Internasional
- Eastern Energy - Thailand
- The State Trading Corporation of India Ltd
- Coalindo Energy - Indonesia
- Krishnapatnam Port Company Ltd. - India
- Iligan Light & Power Inc, Philippines
- San Jose City I Power Corp, Philippines
- Mercator Lines Limited - India
- Therma Luzon, Inc, Philippines
- Planning Commission, India
- Eastern Coal Council - USA
- Jindal Steel & Power Ltd - India
- Merrill Lynch Commodities Europe
- Wilmar Investment Holdings
- Timah Investasi Mineral - Indoneisa
- MS Steel International - UAE
- Neyveli Lignite Corporation Ltd, - India
- Heidelberg Cement - Germany
- Holcim Trading Pte Ltd - Singapore
- Deloitte Consulting - India
- Kalimantan Lumbung Energi - Indonesia
- Semirara Mining Corp, Philippines
- Parry Sugars Refinery, India
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- Ministry of Transport, Egypt
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- Baramulti Group, Indonesia
- Jorong Barutama Greston.PT - Indonesia
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- Aditya Birla Group - India
- Meralco Power Generation, Philippines
- TeaM Sual Corporation - Philippines
- Binh Thuan Hamico - Vietnam
- Orica Australia Pty. Ltd.
- Rashtriya Ispat Nigam Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- Banpu Public Company Limited - Thailand
- Bukit Makmur.PT - Indonesia
- Economic Council, Georgia
- Sojitz Corporation - Japan
- Thai Mozambique Logistica
- Bahari Cakrawala Sebuku - Indonesia
- IEA Clean Coal Centre - UK
- Pendopo Energi Batubara - Indonesia
- Indian Oil Corporation Limited
- CIMB Investment Bank - Malaysia
- Mintek Dendrill Indonesia
- Edison Trading Spa - Italy
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- VISA Power Limited - India
- India Bulls Power Limited - India
- Toyota Tsusho Corporation, Japan
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- Simpson Spence & Young - Indonesia
- Australian Coal Association
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- Asia Pacific Energy Resources Ventures Inc, Philippines
- Bhushan Steel Limited - India
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- GMR Energy Limited - India
- European Bulk Services B.V. - Netherlands
- Alfred C Toepfer International GmbH - Germany
- Minerals Council of Australia
- Siam City Cement - Thailand
- Videocon Industries ltd - India
- Metalloyd Limited - United Kingdom
- Posco Energy - South Korea
- Antam Resourcindo - Indonesia
- Malabar Cements Ltd - India
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- SN Aboitiz Power Inc, Philippines
- PetroVietnam Power Coal Import and Supply Company
- Port Waratah Coal Services - Australia
- Sinarmas Energy and Mining - Indonesia
- Pipit Mutiara Jaya. PT, Indonesia
- Sree Jayajothi Cements Limited - India
- Orica Mining Services - Indonesia
- Madhucon Powers Ltd - India
- Sical Logistics Limited - India
- GVK Power & Infra Limited - India
- Africa Commodities Group - South Africa
- Sakthi Sugars Limited - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Global Coal Blending Company Limited - Australia
- Independent Power Producers Association of India
- Energy Link Ltd, New Zealand
- Australian Commodity Traders Exchange
- Electricity Authority, New Zealand
- Indonesian Coal Mining Association
- OPG Power Generation Pvt Ltd - India
- Karaikal Port Pvt Ltd - India
- Larsen & Toubro Limited - India
- Commonwealth Bank - Australia
- IHS Mccloskey Coal Group - USA
- Rio Tinto Coal - Australia
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- GAC Shipping (India) Pvt Ltd
- McConnell Dowell - Australia
- GN Power Mariveles Coal Plant, Philippines
- Trasteel International SA, Italy
- Star Paper Mills Limited - India
- Siam City Cement PLC, Thailand
- AsiaOL BioFuels Corp., Philippines
- Mercuria Energy - Indonesia
- Indika Energy - Indonesia
- Bulk Trading Sa - Switzerland
- Bhatia International Limited - India
- Ceylon Electricity Board - Sri Lanka
- Sarangani Energy Corporation, Philippines
- Parliament of New Zealand
- Indian Energy Exchange, India
- Dalmia Cement Bharat India
- Offshore Bulk Terminal Pte Ltd, Singapore
- Riau Bara Harum - Indonesia
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- Singapore Mercantile Exchange
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