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Saturday, November 28, 2015

Research and Projects




Declining Asian LNG imports

Eastern Asian LNG imports dropped by 4.2% year-on-year in Q3 2015. According to Global Energy Hub, LNG gross imports dropped by 4.2 % year-on-year in Eastern Asia in Q3 2015. In Japan, South Korea, China and Taiwan LNG imports declined by 1.6 million tons from 38.1 million tons in Q3 2014 to 36.5 million tons in Q3 2015. In Japan, LNG imports were cut by 5.6% down to 20.9 million tons as...... Login to view this article


Stocks at record levels – IEA Oil Market Report

According to the Paris-based International Energy Agency (IEA), global demand growth is forecast to slow to 1.2 mbd in 2016 after surging to a five-year high of 1.8 mbd in 2015. Momentum eases towards its long-term trend as recent props – sharply lower oil prices, colder-than-year earlier winter weather and post-recessionary bounces in some countries – are likely to give way. Global oil supplie...... Login to view this article


Fleet growth

After moderate fleet growth in 2013/14, the growth is now picking up and could be around 3% in 2015, possibly rising to 6% in 2016 depending on sales for decommissioning. There have been very few sales for decommissioning so far in 2015 and with the strong freight market, scrapping activity is not expected to pick up. In addition to sales for decommissioning, we have recorded three VLCCs sold f...... Login to view this article


VLCC spot activity down

We are witnessing a strong crude tanker market, which for obvious reasons indicates strong activity. Spot chartering fixtures from McQuilling Services do, however, indicate that spot chartering activity for VLCCs up to October has generally declined in 2015 because chartering AG – Far East saw a decline. This could be because more cargo has been carried on Chinese-owned VLCCs, while we also hav...... Login to view this article


Plunging rates

VLCC rates peaked 5 October at $106,381 for the Baltic Benchmark route TD3 – Middle East – Japan, declined to below $50,000 per day but increased on Friday to above $60,000 per day. Both the aframax N Sea to Continent and the suezmax West Africa – Continent has improved over this period and the tanker crude oil tanker market is strong for all segments. What are the prospects? There is still an...... Login to view this article


Period chartering up

The average VLCC spot rates so far in 2015 have been at some two-and-a-half times the average rates for 2014, and in particular October has so far been very good for VLCC owners. Also, the other tanker segments have improved strongly compared to last year, however not by as much as the VLCCs. Spot chartering activity has, however, been about on the same level as in 2014 according to information...... Login to view this article


Saudi strategy clearly working

Saudi Arabia decided at the beginning of the year to produce oil at full level instead of reducing production to keep the oil price up. The main motive was probably to squeeze producers with higher production costs, in particular the US shale oil producers, and to discourage investments in exploration and production in marginal high costs areas. Non-OPEC oil production has started to decline an...... Login to view this article


Freight rates see records tumble

Nobody foresaw a rate of over USD100,000 per day for a VLCC this year. When VLCC availability gets scant, the sky is seemingly the limit for the freight rates. Fixture activity so far this year has stayed at approximately the same level until now. October has, on average, traditionally been the busiest month for VLCC fixtures and the beginning of this month has started with very active charteri...... Login to view this article


Report from INTERTANKO European Panel

INTERTANKO’s Senior Manager, Research and Projects, Erik Ranheim, made a market presentation at the recent European Panel meeting in Oslo. In during his presentation, he said that key issues facing the industry, and as a result should be watched, were: China Shale oil, US oil production declining Record Middle East oil production Iran – end boycott Oil stock high/floating storage Tonne miles...... Login to view this article


Oversupply of oil drives the tanker market

Global oil demand growth is expected to climb to a five-year high of 1.7 mbd in 2015 and has been the main driver in the strong tanker market. However oil supplies up to August stood at more than 2.4 mbd above the figure from the same time last year, with non-OPEC producers accounting for 43% of the gain. US oil production that peaked in March at almost 9.7 mbd, declined for the next three mont...... Login to view this article


The biggest oil producers

The US-based Energy Information Administration (EIA) estimates US crude oil production in June 2015 at 9.3 million barrels per day, a decrease of approximately 100,000 barrels per day from the revised May 2015 figure. The latest Petroleum Supply Monthly includes downward revisions of 40,000 to 130,000 barrels per day for the months of January through May 2015. The largest-volume revisions inclu...... Login to view this article


LNG upturn delayed until 2018

Norwegian financial services group DNB’s proprietary liquefaction survey effectively postpones recovery to 2018 (estimated). This summer DNB collected data from all liquefaction plants globally, as a result they reduced their expected tonne-mile demand growth from 11% to 0% for 2015. Next year, 2016, also looks weaker, with growth of 14% compared with previous expectations of 16%, while 2017 no...... Login to view this article


Product imports – Europe the biggest player

Europe is the biggest oil product import area, with European product imports increasing in particular from the Former Soviet Union, (FSU) mainly from Russia. In 2004 imports from Russia were 50 m ts; the projection for this year is almost 80 m ts or some 7 mbd. European product imports have also increased from the US from some 12 m ts in 2004 to an estimate of 26 m ts this year. Europe also...... Login to view this article


Tonne miles estimate for 2015 on upward trajectory

The graph below, showing trades from the main loading areas in tonne miles, depicts a clear picture of the situation in the tanker market. It also shows: the dominance of crude oil export from the Middle East Gulf – 52.5% share in 2015. The two largest trades are Middle East Gulf to Far East (22.0% of all trades) and Japan (9.9%), while the third largest is to the US Gulf, representing 6.6% of...... Login to view this article


Why are VLCC rates falling?

It will not have escaped your attention that freight rates have been falling since 20 July, mainly for VLCCs. The Paris-based International Energy Agency’s (IEA) Oil Market Report this week said that “global oil demand in 2015 is expected to grow by 1.6 mbd, up 0.2 mbd from its previous Report and the fastest pace in five years, as economic growth solidifies and consumers respond to lower oil...... Login to view this article


US product import and export

According to the US-based Energy Information Administration (EIA), gross inputs to US refineries exceeded 17 mbd in each of the past four weeks, a level that had not previously been reached or exceeded in any given week since EIA began publishing the data in 1990. The rolling four-week average of US gross refinery inputs has been above the five-year range every week so far this year. The record...... Login to view this article


China opening up for private crude oil import

China's crude imports were up 7.5% in the first half of 2015 to 6.59 million bpd, although still behind US imports of about 7.3 million bpd for the year so far, according to figures from the US-based Energy Information Administration (EIA). Reuters reports that analysts have said that China has been taking advantage of oil prices that are about half of last year's peak to fill its strategic...... Login to view this article


Iran by and by fully returning to the market?

In 2010 Iran was the 4th biggest crude oil producer with a production of some 3.7 mbd.  In 2014 it was the seventh biggest oil producer producing 2.8 mbd. We see from the below graph that the shortfall in Iranian crude oil production has been more than compensated by increased Iraqi production, which, beside the US, has had the strongest increase in oil production in the world the last couple o...... Login to view this article


Supply of oil overtakes demand

As seen in the graph below, the supply of oil has superseded demand since 2013 and the current level on a yearly basis is some 2.4 mbd, or a VLCC plus a panamax load per day. With some 2,000 VLCC spot contracts in 2014, this would mean an increase in activity of 18%. According to the Paris-based International Energy Agency (IEA) the main reason why supply is so much higher is an increase in...... Login to view this article


Oil demand expected to slow down in 2016 – IEA oil market report

According to the Paris-based International Energy Agency (IEA) Monthly Oil Market Report received today, global oil demand growth is forecast to slow to 1.2 mbd in 2016, from an average 1.4 mbd this year, with strong consumption expected in non-OECD Asia. World oil demand growth appears to have peaked in 1Q15 at 1.8 mbd and will continue to ease throughout the rest of this year and into next as...... Login to view this article


Erik Ranheim
Senior Manager, Research and
P: +47 22 122 675