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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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Wednesday, 09 September 20
MARKET INSIGHT - INTERMODAL
The uneventful summer lull which is coming to an end soon has left its stigma on the newbuilding market, which has already been devastated by the g ...
Saturday, 05 September 20
INDIA WON'T KICK ITS COAL HABIT SO EASILY - HINDU BUSINESS LINE
India has traditionally considered itself lucky to have been endowed with abundant coal reserves, which it has sought to use to meet its energy nee ...
Saturday, 05 September 20
FINANCING COMPLETE FOR 900MW FIFTH PHASE OF MASSIVE DUBAI SOLAR PARK: ARABIAN BUSINESS
Saudi-based ACWA Power on Thursday announced it has completed the signing of all financing agreements for the fifth phase of the Mohammed bin Rashi ...
Saturday, 05 September 20
POLISH COAL DEMAND EXPECTED TO FALL BY 7 MLN TONNES NEXT YEAR: MINISTER - REUTERS
Poland’s demand for coal is expected to fall by around 7 million tonnes next year, or more than 10% of annual hard coal production, after a d ...
Saturday, 05 September 20
PAKISTAN'S NEW 27-YEAR POWER PLAN RISKS LOCKING IN LONG-TERM OVERCAPACITY, LEAVING IMPORTED COAL AND LNG PLANTS STRANDED - IEEFA
Wind and solar, the country’s cheapest source of new generation, also overlooked
Pakistan risks locking itself into building m ...
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- White Energy Company Limited
- ASAPP Information Group - India
- Gujarat Mineral Development Corp Ltd - India
- Xindia Steels Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Borneo Indobara - Indonesia
- Bahari Cakrawala Sebuku - Indonesia
- Posco Energy - South Korea
- Toyota Tsusho Corporation, Japan
- Meralco Power Generation, Philippines
- Central Electricity Authority - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Maharashtra Electricity Regulatory Commission - India
- GMR Energy Limited - India
- Meenaskhi Energy Private Limited - India
- Eastern Coal Council - USA
- Wilmar Investment Holdings
- Thiess Contractors Indonesia
- Ceylon Electricity Board - Sri Lanka
- Simpson Spence & Young - Indonesia
- Mercator Lines Limited - India
- Malabar Cements Ltd - India
- Karaikal Port Pvt Ltd - India
- Sakthi Sugars Limited - India
- Rio Tinto Coal - Australia
- London Commodity Brokers - England
- Sojitz Corporation - Japan
- Interocean Group of Companies - India
- Mintek Dendrill Indonesia
- Eastern Energy - Thailand
- Georgia Ports Authority, United States
- PNOC Exploration Corporation - Philippines
- Bukit Baiduri Energy - Indonesia
- Parry Sugars Refinery, India
- Bhatia International Limited - India
- Anglo American - United Kingdom
- Aboitiz Power Corporation - Philippines
- Bukit Makmur.PT - Indonesia
- Vedanta Resources Plc - India
- Riau Bara Harum - Indonesia
- Petrochimia International Co. Ltd.- Taiwan
- PetroVietnam Power Coal Import and Supply Company
- Kobexindo Tractors - Indoneisa
- Rashtriya Ispat Nigam Limited - India
- Global Green Power PLC Corporation, Philippines
- Energy Development Corp, Philippines
- Mjunction Services Limited - India
- Intertek Mineral Services - Indonesia
- Indika Energy - Indonesia
- Kohat Cement Company Ltd. - Pakistan
- Ambuja Cements Ltd - India
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Sical Logistics Limited - India
- Petron Corporation, Philippines
- Coastal Gujarat Power Limited - India
- Thai Mozambique Logistica
- Electricity Authority, New Zealand
- Videocon Industries ltd - India
- Therma Luzon, Inc, Philippines
- Lanco Infratech Ltd - India
- Renaissance Capital - South Africa
- GVK Power & Infra Limited - India
- Jindal Steel & Power Ltd - India
- Ministry of Mines - Canada
- Gujarat Sidhee Cement - India
- Formosa Plastics Group - Taiwan
- Bayan Resources Tbk. - Indonesia
- Bangladesh Power Developement Board
- Antam Resourcindo - Indonesia
- ICICI Bank Limited - India
- GAC Shipping (India) Pvt Ltd
- Latin American Coal - Colombia
- Directorate Of Revenue Intelligence - India
- Australian Commodity Traders Exchange
- Barasentosa Lestari - Indonesia
- Siam City Cement - Thailand
- SN Aboitiz Power Inc, Philippines
- Siam City Cement PLC, Thailand
- Indogreen Group - Indonesia
- Binh Thuan Hamico - Vietnam
- Economic Council, Georgia
- Indian Energy Exchange, India
- Energy Link Ltd, New Zealand
- Indonesian Coal Mining Association
- Australian Coal Association
- Vizag Seaport Private Limited - India
- Semirara Mining and Power Corporation, Philippines
- Tata Chemicals Ltd - India
- Oldendorff Carriers - Singapore
- Electricity Generating Authority of Thailand
- Sindya Power Generating Company Private Ltd
- Price Waterhouse Coopers - Russia
- Salva Resources Pvt Ltd - India
- Kaltim Prima Coal - Indonesia
- Bhoruka Overseas - Indonesia
- Orica Mining Services - Indonesia
- Kalimantan Lumbung Energi - Indonesia
- The University of Queensland
- Miang Besar Coal Terminal - Indonesia
- Minerals Council of Australia
- Coalindo Energy - Indonesia
- TeaM Sual Corporation - Philippines
- Carbofer General Trading SA - India
- Leighton Contractors Pty Ltd - Australia
- Romanian Commodities Exchange
- Edison Trading Spa - Italy
- Directorate General of MIneral and Coal - Indonesia
- Straits Asia Resources Limited - Singapore
- Larsen & Toubro Limited - India
- Ministry of Finance - Indonesia
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- New Zealand Coal & Carbon
- Manunggal Multi Energi - Indonesia
- Uttam Galva Steels Limited - India
- Jorong Barutama Greston.PT - Indonesia
- Mercuria Energy - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Makarim & Taira - Indonesia
- CIMB Investment Bank - Malaysia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Timah Investasi Mineral - Indoneisa
- San Jose City I Power Corp, Philippines
- Orica Australia Pty. Ltd.
- IEA Clean Coal Centre - UK
- McConnell Dowell - Australia
- Standard Chartered Bank - UAE
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Neyveli Lignite Corporation Ltd, - India
- Altura Mining Limited, Indonesia
- Cigading International Bulk Terminal - Indonesia
- Madhucon Powers Ltd - India
- Medco Energi Mining Internasional
- Globalindo Alam Lestari - Indonesia
- Marubeni Corporation - India
- India Bulls Power Limited - India
- Asmin Koalindo Tuhup - Indonesia
- Merrill Lynch Commodities Europe
- Global Business Power Corporation, Philippines
- Trasteel International SA, Italy
- Sinarmas Energy and Mining - Indonesia
- European Bulk Services B.V. - Netherlands
- Attock Cement Pakistan Limited
- Indian Oil Corporation Limited
- Star Paper Mills Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- SMG Consultants - Indonesia
- Dalmia Cement Bharat India
- Essar Steel Hazira Ltd - India
- IHS Mccloskey Coal Group - USA
- Commonwealth Bank - Australia
- South Luzon Thermal Energy Corporation
- Samtan Co., Ltd - South Korea
- Singapore Mercantile Exchange
- Jaiprakash Power Ventures ltd
- Power Finance Corporation Ltd., India
- Agrawal Coal Company - India
- Aditya Birla Group - India
- Coal and Oil Company - UAE
- Central Java Power - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Planning Commission, India
- Ind-Barath Power Infra Limited - India
- Sree Jayajothi Cements Limited - India
- Tamil Nadu electricity Board
- AsiaOL BioFuels Corp., Philippines
- Independent Power Producers Association of India
- Heidelberg Cement - Germany
- Africa Commodities Group - South Africa
- Bharathi Cement Corporation - India
- Krishnapatnam Port Company Ltd. - India
- PowerSource Philippines DevCo
- Port Waratah Coal Services - Australia
- TNB Fuel Sdn Bhd - Malaysia
- Savvy Resources Ltd - HongKong
- Pipit Mutiara Jaya. PT, Indonesia
- Semirara Mining Corp, Philippines
- Bulk Trading Sa - Switzerland
- Ministry of Transport, Egypt
- CNBM International Corporation - China
- Goldman Sachs - Singapore
- International Coal Ventures Pvt Ltd - India
- LBH Netherlands Bv - Netherlands
- Chettinad Cement Corporation Ltd - India
- Alfred C Toepfer International GmbH - Germany
- Deloitte Consulting - India
- Wood Mackenzie - Singapore
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Karbindo Abesyapradhi - Indoneisa
- Billiton Holdings Pty Ltd - Australia
- MS Steel International - UAE
- VISA Power Limited - India
- Kideco Jaya Agung - Indonesia
- GN Power Mariveles Coal Plant, Philippines
- Kepco SPC Power Corporation, Philippines
- Grasim Industreis Ltd - India
- Banpu Public Company Limited - Thailand
- The Treasury - Australian Government
- Kapuas Tunggal Persada - Indonesia
- SMC Global Power, Philippines
- Bhushan Steel Limited - India
- Iligan Light & Power Inc, Philippines
- The State Trading Corporation of India Ltd
- Baramulti Group, Indonesia
- Pendopo Energi Batubara - Indonesia
- Parliament of New Zealand
- Chamber of Mines of South Africa
- Maheswari Brothers Coal Limited - India
- Kartika Selabumi Mining - Indonesia
- PTC India Limited - India
- Global Coal Blending Company Limited - Australia
- Sarangani Energy Corporation, Philippines
- Cement Manufacturers Association - India
- Indo Tambangraya Megah - Indonesia
- Metalloyd Limited - United Kingdom
- Kumho Petrochemical, South Korea
- Bukit Asam (Persero) Tbk - Indonesia
- OPG Power Generation Pvt Ltd - India
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