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Monday, July 22, 2019

Oil Consumer News

By Coface, the international trade credit insurance company

Has the Oil Price Hit the Low Point?

There are questions whether the low oil price is benefiting South Africa. ICE Brent spot price is trading around $30, the lowest level in 12 years, seen in the context of market surplus. The December meeting in which OPEC failed to set a total production quota and the Chinese stock market turmoil is seen as a sign of increasing concern about China’s health. While expectations of an oversupplied market in 2016 continue, some oil analysts predict an oil price per barrel under $20 in the coming months. The fall in the oil price has party been offset by the weaker rand / dollar exchange rate.

Oil Steady Below $110

New U.S. Brent crude oil was steady below $110 a barrel on Thursday, after hitting a six-week high in the previous session, as traders assessed whether rising tensions in Ukraine could disrupt supplies from Russia. With Russian troops massed on the border with Ukraine and three separatists killed overnight in eastern Ukraine, prospects of defusing the crisis at talks in Geneva appeared slim. Prices were supported by strong U.S. employment data, which showed new applications for unemployment benefits are close to a 6-1/2 year low…

Brent Oil Up to $110 on Ukraine Tension

Brent crude rose close to $110 a barrel on Wednesday due to mounting tensions in Ukraine, while prices for U.S. oil fell after a report showed a huge build in stockpiles in the world's largest oil consumer. Ukrainian government forces and separatist pro-Russian militia staged rival shows of force in eastern Ukraine amid escalating rhetoric on the eve of crucial talks on the former Soviet state's future. Brent crude has been buoyed by the tensions between Kiev and pro-Russian separatists in the east of the country.

Why Tankship Trade to U.S. is in LImbo

Increasingly lower oil demand in the U.S. prompts tankship operators to look towards the China market. According to a BIMCO review, the tanker market is doing full steam ahead – not in relation to demand, earnings or actual operating speed, but in relation to structural demand changes in the West. At the epicentre of this is the world’s most thirsty oil consumer: the U.S. Not to be missed by anyone, the U.S. oil demand recorded a 16-year low in 2012. In 2005, the U.S. consumed 20.8 million of barrels per day (m/bpd), in the same year the domestic oil production stood at 5.2 m/bpd.

The Changing Face of the VLCC Market

With so much discussion of the poor freight rates available to VLCC owners hiring their ships out for voyages from the Middle East to major consumers east and west, it is informative to see how much the spot market for VLCCs has changed in just a few years. Since 2005, there has been a 25% reduction in reported AG/West spot VLCC voyages from 291 in 2005 to 216 in 2011. Just 11 AG/West fixtures were recorded in January 2012; if annualised the total would be 180, only 62% of the number recorded in just seven years earlier.