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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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Sunday, 18 November 18
COAL STOCKS IN A THIRD OF NTPC PLANTS CLOSE TO NIL - FINANCIAL EXPRESS
Coal supply shortage continues to haunt NTPC, the country’s largest power generator, with latest government data showing 31% of the company&r ...
Thursday, 15 November 18
OIL MARKET REPORT: HEEDING THE WARNINGS - IEA
In last month’s Report, we noted that since the middle of the year oil supply had increased sharply, with gains in the Middle East, Russia an ...
Wednesday, 14 November 18
BIMCO ADOPTS 2020 BUNKER CLAUSES
BIMCO has developed two 2020 bunker clauses that deal with general compliance and the transitional period for an early December release.
...
Wednesday, 14 November 18
SHIPPING MARKET INSIGHT - KONSTANTINOS KONTOMICHIS
The shipping industry is going through an interesting period across all markets. Since the end of last year, the Dry Baltic Index has been showing ...
Tuesday, 13 November 18
INDIA: POWER DEMAND UP; COAL STOCKS AT MINES AT A 5-YEAR LOW - FINANCIAL EXPRESS
Stocks at Coal India mines plunged to a five-year low of 21 million tonne (mt) in October, as a sudden surge in demand for the fuel from the power ...
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- Indian Energy Exchange, India
- Kohat Cement Company Ltd. - Pakistan
- PetroVietnam Power Coal Import and Supply Company
- GMR Energy Limited - India
- Vijayanagar Sugar Pvt Ltd - India
- Carbofer General Trading SA - India
- Ambuja Cements Ltd - India
- Gujarat Sidhee Cement - India
- Kartika Selabumi Mining - Indonesia
- Pendopo Energi Batubara - Indonesia
- Bangladesh Power Developement Board
- Indonesian Coal Mining Association
- Bukit Baiduri Energy - Indonesia
- Cement Manufacturers Association - India
- Larsen & Toubro Limited - India
- Electricity Authority, New Zealand
- Indogreen Group - Indonesia
- Manunggal Multi Energi - Indonesia
- Timah Investasi Mineral - Indoneisa
- New Zealand Coal & Carbon
- Tamil Nadu electricity Board
- Price Waterhouse Coopers - Russia
- Indika Energy - Indonesia
- Madhucon Powers Ltd - India
- Videocon Industries ltd - India
- Petron Corporation, Philippines
- CIMB Investment Bank - Malaysia
- Bahari Cakrawala Sebuku - Indonesia
- Coal and Oil Company - UAE
- Bhushan Steel Limited - India
- Formosa Plastics Group - Taiwan
- Dr Ramakrishna Prasad Power Pvt Ltd - India
- Semirara Mining Corp, Philippines
- Uttam Galva Steels Limited - India
- Banpu Public Company Limited - Thailand
- Thiess Contractors Indonesia
- Interocean Group of Companies - India
- PNOC Exploration Corporation - Philippines
- Miang Besar Coal Terminal - Indonesia
- Billiton Holdings Pty Ltd - Australia
- Kalimantan Lumbung Energi - Indonesia
- Independent Power Producers Association of India
- Metalloyd Limited - United Kingdom
- Kaltim Prima Coal - Indonesia
- Central Java Power - Indonesia
- SMC Global Power, Philippines
- London Commodity Brokers - England
- Leighton Contractors Pty Ltd - Australia
- Singapore Mercantile Exchange
- Ministry of Mines - Canada
- Parliament of New Zealand
- Jindal Steel & Power Ltd - India
- Riau Bara Harum - Indonesia
- Ceylon Electricity Board - Sri Lanka
- LBH Netherlands Bv - Netherlands
- Jorong Barutama Greston.PT - Indonesia
- Maharashtra Electricity Regulatory Commission - India
- Minerals Council of Australia
- Semirara Mining and Power Corporation, Philippines
- ASAPP Information Group - India
- European Bulk Services B.V. - Netherlands
- Anglo American - United Kingdom
- Dalmia Cement Bharat India
- Port Waratah Coal Services - Australia
- Xindia Steels Limited - India
- Gujarat Mineral Development Corp Ltd - India
- The University of Queensland
- Intertek Mineral Services - Indonesia
- Maheswari Brothers Coal Limited - India
- Goldman Sachs - Singapore
- Aditya Birla Group - India
- Planning Commission, India
- Australian Coal Association
- Neyveli Lignite Corporation Ltd, - India
- Ind-Barath Power Infra Limited - India
- IHS Mccloskey Coal Group - USA
- Baramulti Group, Indonesia
- SMG Consultants - Indonesia
- Kapuas Tunggal Persada - Indonesia
- Holcim Trading Pte Ltd - Singapore
- Merrill Lynch Commodities Europe
- Electricity Generating Authority of Thailand
- Karaikal Port Pvt Ltd - India
- Kepco SPC Power Corporation, Philippines
- Attock Cement Pakistan Limited
- Eastern Coal Council - USA
- Sree Jayajothi Cements Limited - India
- Borneo Indobara - Indonesia
- Orica Mining Services - Indonesia
- Thai Mozambique Logistica
- Parry Sugars Refinery, India
- Bhatia International Limited - India
- International Coal Ventures Pvt Ltd - India
- Vizag Seaport Private Limited - India
- Aboitiz Power Corporation - Philippines
- Simpson Spence & Young - Indonesia
- PTC India Limited - India
- Alfred C Toepfer International GmbH - Germany
- Australian Commodity Traders Exchange
- Samtan Co., Ltd - South Korea
- Marubeni Corporation - India
- Barasentosa Lestari - Indonesia
- Kumho Petrochemical, South Korea
- Iligan Light & Power Inc, Philippines
- Deloitte Consulting - India
- Tata Chemicals Ltd - India
- Sindya Power Generating Company Private Ltd
- Bharathi Cement Corporation - India
- Makarim & Taira - Indonesia
- Ministry of Transport, Egypt
- Directorate General of MIneral and Coal - Indonesia
- Asmin Koalindo Tuhup - Indonesia
- Mercator Lines Limited - India
- Salva Resources Pvt Ltd - India
- GVK Power & Infra Limited - India
- Pipit Mutiara Jaya. PT, Indonesia
- Kideco Jaya Agung - Indonesia
- Rio Tinto Coal - Australia
- Siam City Cement - Thailand
- Economic Council, Georgia
- Eastern Energy - Thailand
- Antam Resourcindo - Indonesia
- Sojitz Corporation - Japan
- Orica Australia Pty. Ltd.
- Meenaskhi Energy Private Limited - India
- Malabar Cements Ltd - India
- The State Trading Corporation of India Ltd
- Rashtriya Ispat Nigam Limited - India
- Edison Trading Spa - Italy
- Bukit Makmur.PT - Indonesia
- Mercuria Energy - Indonesia
- Gujarat Electricity Regulatory Commission - India
- Global Coal Blending Company Limited - Australia
- Filglen & Citicon Mining (HK) Ltd - Hong Kong
- San Jose City I Power Corp, Philippines
- The Treasury - Australian Government
- Kobexindo Tractors - Indoneisa
- AsiaOL BioFuels Corp., Philippines
- Krishnapatnam Port Company Ltd. - India
- Bulk Trading Sa - Switzerland
- Essar Steel Hazira Ltd - India
- Truba Alam Manunggal Engineering.Tbk - Indonesia
- Sical Logistics Limited - India
- Sakthi Sugars Limited - India
- Therma Luzon, Inc, Philippines
- Energy Link Ltd, New Zealand
- Savvy Resources Ltd - HongKong
- Energy Development Corp, Philippines
- Posco Energy - South Korea
- OPG Power Generation Pvt Ltd - India
- Indian Oil Corporation Limited
- Romanian Commodities Exchange
- Bhoruka Overseas - Indonesia
- PowerSource Philippines DevCo
- Medco Energi Mining Internasional
- Heidelberg Cement - Germany
- Coastal Gujarat Power Limited - India
- Standard Chartered Bank - UAE
- CNBM International Corporation - China
- MS Steel International - UAE
- VISA Power Limited - India
- Asia Pacific Energy Resources Ventures Inc, Philippines
- India Bulls Power Limited - India
- Chamber of Mines of South Africa
- Binh Thuan Hamico - Vietnam
- Ministry of Finance - Indonesia
- Africa Commodities Group - South Africa
- Power Finance Corporation Ltd., India
- Central Electricity Authority - India
- Bank of Tokyo Mitsubishi UFJ Ltd
- Star Paper Mills Limited - India
- Jaiprakash Power Ventures ltd
- SN Aboitiz Power Inc, Philippines
- Wilmar Investment Holdings
- Chettinad Cement Corporation Ltd - India
- ICICI Bank Limited - India
- Karbindo Abesyapradhi - Indoneisa
- McConnell Dowell - Australia
- Wood Mackenzie - Singapore
- Mjunction Services Limited - India
- Bukit Asam (Persero) Tbk - Indonesia
- Offshore Bulk Terminal Pte Ltd, Singapore
- Global Green Power PLC Corporation, Philippines
- TNB Fuel Sdn Bhd - Malaysia
- Grasim Industreis Ltd - India
- GN Power Mariveles Coal Plant, Philippines
- Agrawal Coal Company - India
- Renaissance Capital - South Africa
- South Luzon Thermal Energy Corporation
- Bayan Resources Tbk. - Indonesia
- Latin American Coal - Colombia
- Sarangani Energy Corporation, Philippines
- Indo Tambangraya Megah - Indonesia
- Straits Asia Resources Limited - Singapore
- IEA Clean Coal Centre - UK
- Global Business Power Corporation, Philippines
- Vedanta Resources Plc - India
- Mintek Dendrill Indonesia
- Cigading International Bulk Terminal - Indonesia
- TeaM Sual Corporation - Philippines
- Sinarmas Energy and Mining - Indonesia
- Commonwealth Bank - Australia
- Trasteel International SA, Italy
- Globalindo Alam Lestari - Indonesia
- Coalindo Energy - Indonesia
- Georgia Ports Authority, United States
- Petrochimia International Co. Ltd.- Taiwan
- Dong Bac Coal Mineral Investment Coporation - Vietnam
- Altura Mining Limited, Indonesia
- White Energy Company Limited
- Oldendorff Carriers - Singapore
- Meralco Power Generation, Philippines
- Siam City Cement PLC, Thailand
- Toyota Tsusho Corporation, Japan
- GAC Shipping (India) Pvt Ltd
- Directorate Of Revenue Intelligence - India
- Lanco Infratech Ltd - India
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