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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, 06 August 19
SHIPPING MARKET INSIGHT - INTERMODAL
On the 12th of May four tankers were attacked near the coast of Fujairah. The tankers hit were waiving international flags such as that of No ...
Monday, 05 August 19
SUPRAMAX: COAL FROM INDONESIA TO CHINA PAID AT MID $8,000S ON A 57,000-TONNER DELIVERY SOUTH CHINA - BALTIC BRIEFING
Capesize
Having hit a high of $32,963 early last week, the Capesize 5TC now stands at $25,749. This is over 20% of its value lost in 10 days. C ...
Thursday, 01 August 19
PANAMAX: THE SENTIMENT IN THE MARKET IS STILL POSITIVE FOR THE LONGER TERM - FEARNLEYS
Capesize
Two weeks ago the 5TC index was at 33,000 USD pd. Since then it has fallen off a bit and has stayed around 27,000 USD pd the last week ...
Thursday, 01 August 19
INDIKA ENERGY REVENUES DECLINE DUE TO LOW COAL PRICES
One of the largest Indonesian integrated energy companies PT Indika Energy Tbk posted revenues of US $ 1,380.4 million, down 4.6% compared to US $ ...
Wednesday, 31 July 19
INDIA'S 2019 THERMAL COAL IMPORTS SEEN AT 180-185 MLN T - WOODMAC
India is expected to import 180-185 million tonnes of thermal coal in 2019, said Dale Hazelton, head of thermal coal at consultancy Wood Mackenzie. ...
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- Central Java Power - Indonesia
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- South Luzon Thermal Energy Corporation
- Makarim & Taira - Indonesia
- Australian Commodity Traders Exchange
- GMR Energy Limited - India
- Leighton Contractors Pty Ltd - Australia
- Parliament of New Zealand
- Ministry of Finance - Indonesia
- SMC Global Power, Philippines
- Videocon Industries ltd - India
- Tamil Nadu electricity Board
- Kobexindo Tractors - Indoneisa
- Merrill Lynch Commodities Europe
- Wood Mackenzie - Singapore
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Gujarat Sidhee Cement - India
- Ministry of Transport, Egypt
- SMG Consultants - Indonesia
- PowerSource Philippines DevCo
- Bangladesh Power Developement Board
- Iligan Light & Power Inc, Philippines
- Heidelberg Cement - Germany
- Bhoruka Overseas - Indonesia
- Bank of Tokyo Mitsubishi UFJ Ltd
- Vizag Seaport Private Limited - India
- Sinarmas Energy and Mining - Indonesia
- Gujarat Mineral Development Corp Ltd - India
- Global Business Power Corporation, Philippines
- ICICI Bank Limited - India
- Bharathi Cement Corporation - India
- Savvy Resources Ltd - HongKong
- Goldman Sachs - Singapore
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- Standard Chartered Bank - UAE
- TNB Fuel Sdn Bhd - Malaysia
- Kideco Jaya Agung - Indonesia
- Timah Investasi Mineral - Indoneisa
- Bukit Baiduri Energy - Indonesia
- Globalindo Alam Lestari - Indonesia
- Renaissance Capital - South Africa
- Sarangani Energy Corporation, Philippines
- Energy Link Ltd, New Zealand
- VISA Power Limited - India
- Energy Development Corp, Philippines
- Vijayanagar Sugar Pvt Ltd - India
- Eastern Coal Council - USA
- Bahari Cakrawala Sebuku - Indonesia
- Global Green Power PLC Corporation, Philippines
- Star Paper Mills Limited - India
- European Bulk Services B.V. - Netherlands
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- Price Waterhouse Coopers - Russia
- Sindya Power Generating Company Private Ltd
- Chettinad Cement Corporation Ltd - India
- Coal and Oil Company - UAE
- Indo Tambangraya Megah - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Indika Energy - Indonesia
- Toyota Tsusho Corporation, Japan
- Orica Mining Services - Indonesia
- Cigading International Bulk Terminal - Indonesia
- Sakthi Sugars Limited - India
- Banpu Public Company Limited - Thailand
- Cement Manufacturers Association - India
- Eastern Energy - Thailand
- Central Electricity Authority - India
- Chamber of Mines of South Africa
- Kohat Cement Company Ltd. - Pakistan
- Essar Steel Hazira Ltd - India
- Xindia Steels Limited - India
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Singapore Mercantile Exchange
- Asia Pacific Energy Resources Ventures Inc, Philippines
- Independent Power Producers Association of India
- Antam Resourcindo - Indonesia
- McConnell Dowell - Australia
- Indogreen Group - Indonesia
- Posco Energy - South Korea
- LBH Netherlands Bv - Netherlands
- Power Finance Corporation Ltd., India
- Manunggal Multi Energi - Indonesia
- Kaltim Prima Coal - Indonesia
- Bukit Asam (Persero) Tbk - Indonesia
- Sical Logistics Limited - India
- Petrochimia International Co. Ltd.- Taiwan
- The State Trading Corporation of India Ltd
- TeaM Sual Corporation - Philippines
- Simpson Spence & Young - Indonesia
- Meenaskhi Energy Private Limited - India
- Maharashtra Electricity Regulatory Commission - India
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Alfred C Toepfer International GmbH - Germany
- Jaiprakash Power Ventures ltd
- The Treasury - Australian Government
- PNOC Exploration Corporation - Philippines
- New Zealand Coal & Carbon
- Dalmia Cement Bharat India
- GVK Power & Infra Limited - India
- SN Aboitiz Power Inc, Philippines
- Altura Mining Limited, Indonesia
- Grasim Industreis Ltd - India
- Salva Resources Pvt Ltd - India
- Bayan Resources Tbk. - Indonesia
- Borneo Indobara - Indonesia
- Indonesian Coal Mining Association
- Orica Australia Pty. Ltd.
- Port Waratah Coal Services - Australia
- Miang Besar Coal Terminal - Indonesia
- Mercuria Energy - Indonesia
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- Metalloyd Limited - United Kingdom
- Bukit Makmur.PT - Indonesia
- Formosa Plastics Group - Taiwan
- PetroVietnam Power Coal Import and Supply Company
- Attock Cement Pakistan Limited
- Siam City Cement - Thailand
- Electricity Generating Authority of Thailand
- Binh Thuan Hamico - Vietnam
- GN Power Mariveles Coal Plant, Philippines
- Karaikal Port Pvt Ltd - India
- Indian Oil Corporation Limited
- Krishnapatnam Port Company Ltd. - India
- Thai Mozambique Logistica
- Kepco SPC Power Corporation, Philippines
- Kartika Selabumi Mining - Indonesia
- Uttam Galva Steels Limited - India
- Petron Corporation, Philippines
- Asmin Koalindo Tuhup - Indonesia
- Ind-Barath Power Infra Limited - India
- Bulk Trading Sa - Switzerland
- Coalindo Energy - Indonesia
- CNBM International Corporation - China
- Romanian Commodities Exchange
- Deloitte Consulting - India
- Mintek Dendrill Indonesia
- Larsen & Toubro Limited - India
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- Meralco Power Generation, Philippines
- Aboitiz Power Corporation - Philippines
- Riau Bara Harum - Indonesia
- Africa Commodities Group - South Africa
- GAC Shipping (India) Pvt Ltd
- Kumho Petrochemical, South Korea
- Australian Coal Association
- Jorong Barutama Greston.PT - Indonesia
- Carbofer General Trading SA - India
- Global Coal Blending Company Limited - Australia
- Semirara Mining and Power Corporation, Philippines
- Therma Luzon, Inc, Philippines
- Siam City Cement PLC, Thailand
- Indian Energy Exchange, India
- Malabar Cements Ltd - India
- Samtan Co., Ltd - South Korea
- Pendopo Energi Batubara - Indonesia
- Maheswari Brothers Coal Limited - India
- Bhushan Steel Limited - India
- Holcim Trading Pte Ltd - Singapore
- Agrawal Coal Company - India
- India Bulls Power Limited - India
- Anglo American - United Kingdom
- Kapuas Tunggal Persada - Indonesia
- Ambuja Cements Ltd - India
- PTC India Limited - India
- Ceylon Electricity Board - Sri Lanka
- IEA Clean Coal Centre - UK
- CIMB Investment Bank - Malaysia
- Kalimantan Lumbung Energi - Indonesia
- Mjunction Services Limited - India
- Parry Sugars Refinery, India
- Directorate General of MIneral and Coal - Indonesia
- ASAPP Information Group - India
- International Coal Ventures Pvt Ltd - India
- OPG Power Generation Pvt Ltd - India
- Sree Jayajothi Cements Limited - India
- The University of Queensland
- Tata Chemicals Ltd - India
- IHS Mccloskey Coal Group - USA
- Planning Commission, India
- Pipit Mutiara Jaya. PT, Indonesia
- Rio Tinto Coal - Australia
- AsiaOL BioFuels Corp., Philippines
- Straits Asia Resources Limited - Singapore
- Billiton Holdings Pty Ltd - Australia
- London Commodity Brokers - England
- Ministry of Mines - Canada
- Oldendorff Carriers - Singapore
- Sojitz Corporation - Japan
- Jindal Steel & Power Ltd - India
- San Jose City I Power Corp, Philippines
- Minerals Council of Australia
- Commonwealth Bank - Australia
- Baramulti Group, Indonesia
- Aditya Birla Group - India
- Bhatia International Limited - India
- Directorate Of Revenue Intelligence - India
- Barasentosa Lestari - Indonesia
- Thiess Contractors Indonesia
- Intertek Mineral Services - Indonesia
- Marubeni Corporation - India
- Georgia Ports Authority, United States
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- Wilmar Investment Holdings
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- Coastal Gujarat Power Limited - India
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- White Energy Company Limited
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- Economic Council, Georgia
- MS Steel International - UAE
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