The Tipping Point: U.S. Exports more Oil than it Imports
The United States last week exported more crude oil and fuel than it imported for the first time on record, underscoring the nation's growing influence as a supplier of oil to the world.Exports of crude surged in the week to Nov. 30 to more than 3.2 million barrels per day, the U.S. Energy Information Administration said on Thursday.When adding in all imports and exports of crude and refined products, for the week the U.S. exported a net 211,000 bpd – the first time that has happened, according to U.S.
Chinese Marine Builder to Work with Singapore Trader to Buy Fuel
The marine construction unit of the state-owned China Communications Construction Company (CCCC) on Tuesday signed an agreement to work with Singapore-based commodities trader Zenrock Group to purchase fuel.Marine Construction & Development Co (MCD), which is involved in major infrastructure projects around the world as part of China's Belt and Road initiative, wants to streamline its process for buying fuel, said Chief Financial Officer Jin Xinxiang."In the past, (our) oil procurement activities have been very segregated into individual projects.
Venezuela Dodges Oil Asset Seizures with Export Transfers at Sea
Venezuela's state-run oil company PDVSA has limited the damage from an unprecedented slump in crude exports by transferring oil between tankers at sea and loading vessels in neighboring Cuba to avoid asset seizures.But the OPEC member nation is still fulfilling less than 60 percent of its obligations under supply deals with customers.Venezuela has been pumping oil this year at the lowest rate in three decades after years of underinvestment and a mass exodus of workers. The state…
Enterprise Adds Vessel Fueling Capabilities at Houston
Enterprise Products Partners, as of June 1, 2018, is the exclusive provider of residual marine fuel (RMG 380) and marine gas oil (MGO) at its Enterprise Hydrocarbons Terminal (EHT) on the Houston Ship Channel. RMG 380 and MGO are the primary transportation fuels used by deep-draft vessels that dock at the EHT facility. “Being able to fuel ships as they load and offload product at our EHT marine terminal significantly streamlines the process, saving our customers time and money by not having to stop at a third party facility,” said A.J.
PDVSA Halts Caribbean Storage, Shipping; Diverts Oil Cargo
Venezuela's state-run PDVSA suspended oil storage and shipping from its Caribbean facilities following a move by ConocoPhillips to temporarily seize the firm's assets on four islands, according to a PDVSA source and Reuters data.PDVSA has begun concentrating most shipping in its main crude terminal of Jose on Venezuela's eastern coast and recalling tankers to Venezuelan waters to avoid seizures that would further cut its exports and worsen an economy on the verge of collapse.U.S.…
U.S. Considers Venezuela Oil Sanctions
The Trump administration is considering sanctioning a Venezuelan military-run oil services company and restricting insurance coverage for Venezuelan oil shipments to ratchet up pressure on socialist President Nicolas Maduro, a U.S. official said. With Maduro running for another term in an April election that Washington and its allies oppose as a sham, the United States is weighing sanctions that would target Venezuela’s vital oil sector beyond what has been done before, the official told Reuters on Wednesday. Some measures could come before the vote and others could be imposed afterwards.
U.S. Midwest Refiners Boost Output
U.S. refineries from Ohio to Minnesota are capitalizing on access to cheap crude from Western Canada and North Dakota oilfields, helping their region break a historic dependence on fuel from the Gulf Coast while redrawing oil trade maps. Since the early 2000s, crude and fuel flows from the Gulf Coast into the U.S. heartland have been cut in half, as crude coming from Canada and North Dakota has pushed U.S. Midwest refining activity to record levels. In 2016, Midwest refining capacity rose to 3.9 million barrels per day (bpd) of crude, the highest annual volume on record.
Full Tanks & Tankers: A Stubborn Oil Glut Despite OPEC Cuts
After the first OPEC oil production cut in eight years took effect in January, oil traders from Houston to Singapore started emptying millions of barrels of crude from storage tanks. Investors hailed the drawdowns as the beginning of the end of a two-year supply glut - raising hopes for steadily rising per-barrel prices. It hasn't worked out that way. Now, many of those same storage tanks are filling back up or draining more slowly than investors and oil firms had expected, according…
Tankers Are Like A Box Of Chocolates
The uncertainty around the direction of the tanker market has increased since the start of 2016. At current production levels, the markets for both crude oil and (certain) refined products seem oversupplied, which supports healthy spot rates for both crude oil and product tankers. Tanker market bulls argue that if crude producers keep pumping oil at full tilt and refiners continue to process it at high levels, the tanker market will have another banner year. Tanker rates will be particularly strong if the oversupplied oil markets lead to significant levels of floating storage.
Oil Storage Business is Booming
(John Kemp is a Reuters market analyst. Oil producers may be struggling as a result of low prices but the oil storage business has never been in better shape. U.S. refiners, traders and logistics companies added an extra 11 million barrels of working storage capacity for crude oil between March and September, according to the U.S. Energy Information Administration. Since September 2011, total capacity for storing crude in the United States has expanded by almost 87 million barrels, 19 percent, the EIA reported on Monday ("Working and Net Available Shell Storage Capacity" Nov. 30). Most of the extra capacity has been added at tank farms and other offsite locations (+84 million barrels) rather than refineries (+2.5 million barrels) where space is often constrained.
Amid Commodity Crisis, LPG Emerges as Accidental Bright-spot
Liquefied Petroleum Gas, long a niche product used by the poor to cook and the rich to barbecue, has become a rare bright spot amid a broad commodities rout, riding on the wave of strong economic growth in India and parts of Southeast Asia. LPG is best known to consumers as propane or butane used in heating appliances and vehicles. But it is also used in the petrochemicals industry and the electricity sector, acting as a replacement for diesel in generators and power stations. While tumbling prices for oil, gas, coal and industrial metals have seen energy companies and miners slash capital expenditure, investment is flowing into the LPG sector to feed burgeoning demand from the world's poorer nations.
Venezuela, Ecuador to Defend Oil Prices
Venezuela and Ecuador are working on a joint proposal to defend oil prices that the two countries will present at the next OPEC meeting, Venezuelan President Nicolas Maduro said on Friday. Venezuela was the first country to request an extraordinary meeting of Organization of the Petroleum Exporting Countries to discuss the sharp drop in crude prices that began in October, but the idea got little support. "Our Foreign Minister Rafael Ramirez was in Ecuador today coordinating with the government of President (Rafael) Correa…
A History of U.S. Oil Export Controls
On Oct. 20, 1973, King Faisal of Saudi Arabia imposed a total embargo on oil shipments to the United States among other countries in response to their support for Israel during the Arab-Israeli war. Faisal's decision led directly to the introduction of a ban on U.S. crude exports, which remains in force in a slightly modified form and is now the focus of an intense struggle for reform. Following the U.S. mid-term elections next month, Congress will take up the issue again, a debate that would benefit from an understanding of the history behind the ban. On Oct.
Product Tankship Demand & Overcapacity: An Industry Note
Concern about oversupply only occurs when there are too many ships relative to demand, and in a recent 'Industry Note', McQuilling Services attempts to quantify the situation. Much has been said about the product tanker market recently, mainly about tonnage supply. More industry voices are speaking about their concern of over-ordering and too many ships. However, the number of vessels on order and planned for delivery is really only half the story. As long as there is enough demand, any number of ships on order may be acceptable.
Tankship Ocean Transportation Demand: Forecasting Essentials
Marine transport advisors, McQuilling Services, give an insight into how they forecast the development of tanker demand, which is a constituent part of their recently published '2014-2018 Tanker Market Outlook' report. At a global level, marine transportation demand is related to world trade, which is directly related to the state of the world economy. This means that demand for crude oil and petroleum products grows with an expanding global economy. Marine transportation demand for tankers is a derived demand. It arises from the energy consumption requirements of regional economies.
Teekay Rating Raised
Standard & Poor's revised its outlook on Teekay Shipping Corp. to positive from stable. The outlook revision reflects Teekay's consistent, solid performance, which has resulted in a gradually improving financial profile, and expectations for more predictable cash flow generation due to the purchase of contract-based shuttle tanker operator Ugland Nordic Shipping ASA. Teekay's rating reflects a favorable business position as the leading midsize ("Aframax") crude oil tanker operator in the Indo-Pacific Basin, expanded presences in the AtlanticAframax tanker market and the North Sea Shuttle tanker market, and fairly conservative financial policies. These factors are offset by significant, but carefully managed exposure to the volatile tanker spot markets.
Strong Market Continues
In 2000, VLCCs obtained $53,000 per day, up from less than $20,000 in 1999. Old VLCCs reached $33,000 per day compared with only $11,000 in 1999. The freight market boom also had its effect on medium size crude carriers. After poor market conditions in 1999 with modern Suezmaxes obtaining $15,000 per day the average in 2000 was $40,000. Corresponding figures for modern Aframaxes were $13,000 as an average in 1999, reaching $37,000 in 2000. Peak rates in the year for both types were recorded in December at $60,000 per day. Large clean carriers (LR2) last year obtained $32,000 per day, which is $18,000 higher than the 1999 level. Modern MR types rose from $8,000 per day to $16,000 per day in year 2000, with more than $30,000 in December.