Contracted Rates to Fall Long-term Due to Conoravirus -Xeneta
The container shipping segment appears to have caught coronavirus, with the industry suffering its first monthly fall in long-term contracted ocean freight rates since October 2019. According to the latest XSI Public Indices report from Xeneta, March 2020 saw a small dip of 0.5% in rates after a sustained period of growth. Although these symptoms look mild, the future is characterized by growing uncertainty, with widespread economic disruption and looming global recession likely…
Oil Economics: Freight Rate Surge Cuts into Trader's Profits
A jump in freight rates has shaved profits for oil traders seeking to store crude for sale towards the end of the year, even as the contango in the first six months for Brent futures stretched to its widest ever, trade sources said.While a sharp rebound in spot crude differentials could lift traders' profits, a broadening slump in global demand is stretching out the time that markets will need to digest bulging inventories and spark a price recovery, traders said.Unlike in previous contango plays -- where low oil prices eventually prompted major producers to tighten supplies…
Borr Drilling Launches US IPO
Offshore drilling contractor Borr Drilling has launched the initial public offering (IPO) in the United States of 5 million of its common shares on July 29.The drilling company that operates 27 rigs said that the offering of common shares on the New York Stock Exchange is at prices it expects to be ‘substantially similar’ to its share price on the Oslo Bors.The IPO price will be determined based on the book-building process and the closing price of its shares on the Oslo Børs on the pricing date of the offering.
IMO 2020: Shell, HES to Resurrect Refinery
Royal Dutch Shell has struck a deal with Dutch tank terminal firm HES International to partially restart a German oil refinery mothballed since 2011 in response to new restrictions on marine fuels, two trading sources told Reuters.A new cap set by the International Maritime Organization (IMO) that will cut the sulfur content in shipping fuel to 0.5 percent from 3.5 percent from next year is set to be one of the biggest fundamental events to hit oil markets in years.HES Wilhelmshaven Tank Terminal is in the process of reinstalling the vacuum distillation unit (VDU) at Wilhelmshaven to produce low-sulfur bunker fuels ahead of the implementation of the IMO rules…
Biggest Spenders of 2018
With less than a week until Christmas and most of our presents bought, we're feeling the pinch. However, that's nothing compared to the amount that some have been spending this year. VesselsValue's Senior Analyst Court Smith gives a rundown on which countries have splashed the most cash on second hand vessel purchases over 2018.USAJP Morgan Global Maritime is the US company who has spent the most on second hand vessels: 308 million USD so far in 2018. However, they have changed their purchasing strategy half way through the year.
Cerberus to Acquire Subsea Communications Business from TE Connectivity
Cerberus Capital Management announced that one of its affiliates has entered into an agreement with TE Connectivity under which Cerberus will acquire TE's Subsea Communications business (SubCom).Headquartered in Eatontown, New Jersey, SubCom is a leading global supplier of subsea communications systems with approximately $700 million in revenue, based on fiscal year 2018 expectations. The business designs, manufactures, deploys, and maintains the subsea fiber optic cable systems that are vital for global communications.To date…
ABS Discusses on IMO 2020
Shipping industry leaders, joined by Goldman Sachs, discussed IMO 2020 challenges and opportunities at the ABS panel discussion held at the start of SMM 2018. They exchanged their views on compliant fuel availability, fuel pricing spreads and scrubbers shape the conversation at SMM.Christian Lelong, Senior Commodities Analyst, Goldman Sachs; Aaron Bresnahan, Vice President Marine Solutions, Wartsila; Paddy Rodgers, Director and Chief Executive Officer, EURONAV; Wolfgang Hintzsche…
Mercuria Energy Takes 30% Stake in Aegean Marine
Mercuria Energy Group and Aegean Marine Petroleum and have signed a Memorandum of Understanding (MoU) making Mercuria the only lender to Aegean. Both are working towards landing a billion dollar credit deal and closer collaboration.Mercuria and Aegean have executed a letter agreement detailing the US$30 million of incremental liquidity Mercuria is providing to the Company by way of amendments and waivers to the Trade Finance Facility and other financing arrangements.With this significant step completed, the two parties intend to begin exploring a broader, global strategic partnership.
Kosmos Energy Acquired DGE for $1.23 Bln
Kosmos Energy has agreed to acquire Deep Gulf Energy (DGE) from its private equity owner for $1.23 billion, according to a bourse filing on Monday, expanding the deepwater oil and gas firm's operations into the Gulf of Mexico.Dallas-based Kosmos, which currently operates in Africa and South America, will pay $925 million in cash and $300 million in Kosmos common stock to acquire DGE, with the transaction expected to close towards the end of the third quarter.Acquiring DGE's business will increase Kosmos' production by more than 50 percent to 70,000 barrels of oil equivalent per day (boed) from
Harvey Gulf Announces New BoD
Harvey Gulf International Marine’s parent, HGIM Corp., has announced the appointment of a new Board of Directors to serve following the company’s emergence from Chapter 11 proceedings.The seven member Board includes two current members remaining on the Board and five new members, each with expertise in individual areas particularly suited to support the company’s operation and development and collectively, creating a leadership platform that will enable Harvey Gulf to adjust and thrive in an ever-changing market. Shane Guidry. Mr.
Shipping Tycoon Livanos Tied to New Investment Firm
Former senior Goldman Sachs and HSBC banker Matthew Westerman is launching a private investment firm alongside a former colleague and a Greek shipping tycoon, he said on Friday.Westerman will partner his former Goldman Sachs colleague Julian Metherell and Peter Livanos, who owns Greek shipping company Ceres Hellenic, in a new firm called MW&L Capital Partners.The trio will invest in small-to-medium sized targets based on knowledge built up in their respective careers covering financial services, oil and gas, and shipping, Westerman said."We think there is a gap in the market for long-term capital; ours is not '5 year fund money' so we don't have money burning a hole in our pockets and we can afford to be flexible and supportive of management when we see an opportunity…
Share Holders Okay Macquarie, Goldman Sachs to Acquire HES International
Riverstone Holdings and The Carlyle Group jointly announce that they intend to sell HES International to a consortium of Macquarie Infrastructure and Real Assets (MIRA) & Goldman Sachs. Macquarie European Infrastructure Fund 5, which is managed by MIRA, and West Street Infrastructure Partners III (WSIP), which is managed by the Merchant Banking Division of Goldman Sachs, have reached an agreement in principle with Riverstone Holdings and The Carlyle Group to acquire HES International.
Macquarie, Goldman Sachs to Buy HES International
Infrastructure funds managed by Macquarie and Goldman Sachs have agreed to buy Dutch port terminals operator HES International from owners Riverstone and The Carlyle Group, they said on Tuesday. Terms were not disclosed. Reuters reported in February that Macquarie and Goldman funds were poised to buy HES for around 2 billion euros ($2.45 billion). HES is one of the largest diversified port terminals businesses in Europe with 18 dry and liquid bulk terminals. Reporting by Toby Sterling
Steel, Aluminum Tariffs a 'Bad Idea' -Morgan Stanley CEO
Morgan Stanley's top executive said on Wednesday that potential tariffs on steel and aluminum that U.S. "The biggest issues this country faces are not trade deficits, they're fiscal deficits," Chief Executive Officer James Gorman told CNBC. Gorman said that imposing tariffs on a country or ally that the United States sells a lot of goods to is not the "best way to move forward." He added that there may be retaliation from other countries due to the tariffs. "You can't be unilateral with these things," he added.
Asian Floating Storage Declines as Crude Market Tightens
Strong demand is tightening the market but rising US output could sap efforts to rebalance market. The amount of oil stored on tankers around Singapore has dropped sharply in the last months, the latest indication that OPEC-led supply cuts are successfully tightening crude markets even as U.S. exports have soared. Shipping data in Thomson Reuters Eikon shows around 15 super-tankers are currently filled with oil in waters off Singapore and western Malaysia, storing around 30 million barrels of crude.
Asian Traders Mull U.S. Crude Liftings in Harvey's Wake
Harvey closed nearly a quarter of U.S. refining capacity; helping to push WTI-Brent spread to widest in two years. Some oil traders in Asia are looking to snap up crude cargoes from the United States after Hurricane Harvey closed U.S. refineries, denting local demand and pushing out the price spread between U.S and Atlantic Basin crude benchmarks. Hurricane Harvey barrelled into the U.S. Gulf of Mexico coast around 10 days ago, closing nearly a quarter of the nation's refining capacity, although some of that is now coming back online.
Traders Look to Asia Products for U.S. Options
Traders adding U.S. port options to cargoes for flexibility. Traders are scrambling to find oil products in Asia to ship to the United States and Latin America after Hurricane Harvey shut almost a quarter of U.S. refining capacity, several trading and shipping sources told Reuters on Wednesday. Many are also asking for ships to have a U.S. option added to their original destination to allow for flexibility in sending the cargoes across the Pacific, shipbrokers said. At least one oil products tanker…
Crude Slips, Gasoline Jumps in Storm's Choppy Wake
Goldman Sachs says 23 pct of U.S. refining capacity is shut. Crude oil slid and gasoline futures hit their highest since mid-2015 on Wednesday as flooding and damage from Tropical Storm Harvey shut over a fifth of U.S. refineries, curbing demand for crude while raising the risk of fuel shortages. Refineries with output of 4.1 million barrels per day (bpd) were offline on Tuesday, representing 23 percent of U.S. production, Goldman Sachs said. Restarting plants even under the best conditions can take a week or more. "It will be a while before operations can return to normal and the U.S.
CMA CGM Invests in NYSHEX Market
CMA CGM, a world leader in container shipping, is pleased to announce its participation in the first ever New York Shipping Exchange (NYSHEX) fundraiser, the first digital marketplace for ocean freight contracts. This investment is made alongside Hapag Lloyd, GE Ventures and Goldman Sachs, for a cumulative investment of $13 million. It is carried out through CMA CGM Ventures, the corporate venture structure recently created by the CMA CGM Group and dedicated to investments in innovative technologies.
Should OPEC Worry About Contango and Backwardation?
"Backwardation is the solution" to OPEC's problem of how to raise output and revenues without sparking another shale boom, according to the influential oil research team at Goldman Sachs. Backwardation would allow low-cost oil producers in OPEC to sell their output at a higher price linked to the spot market while curbing growth from shale firms that sell at prices linked to the forward curve. Goldman's strategy aims to "share growth" between OPEC and shale firms to avoid another repeat of boom and bust in oil prices ("Backwardation is the solution", Goldman Sachs, May 22). The plan exploits differences in pricing behaviour between low-cost producers in OPEC that do not hedge and higher-cost shale drillers that hedge a substantial portion of their output.
Oil and Trump: Russians Full of Optimism in Davos
What a difference a year makes. Twelve months ago, the mood of the Russian delegation at the World Economic Forum in Davos was distinctly gloomy, with oil prices near 12-year lows below $30 per barrel and Western sanctions depressing their economy and financial markets. Since then, however, Russian stock and bond markets have risen about 50 percent, boosted by rebounding oil and - more recently - expectations the new U.S. presidency of Donald Trump will ease the sanctions imposed over Moscow's actions in Ukraine. Russian officials and company executives at the forum attended by the world's political and business elites in the Swiss Alps this week were far more bullish, with many predicting the markets rally would continue this year.
GE to Merge Oil & Gas Unit with Baker Hughes
General Electric Co said on Monday it would merge its oil and gas business with Baker Hughes Inc, creating the world's second-largest oilfield services provider as competition heats up to supply more-efficient products and services to the energy industry after several years of low crude prices. The deal to create a company with $32 billion in annual revenue will combine GE's strengths in making equipment long-prized by oil producers with Baker Hughes's expertise in drilling and fracking new wells.
Oil Steady, Supply Outlook Unclear
Oil prices were little changed on Monday, with little news to influence a market waiting to see whether U.S. production from shale fields will grow enough to offset planned output cuts by OPEC, Russia and other producers next year. Brent futures for February delivery were down 24 cents, or 0.4 percent, at $54.97 a barrel by 11:43 a.m. EST (1643 GMT). U.S. West Texas Intermediate crude for January rose 6 cents, or 0.1 percent, to $51.96 per barrel on its last day as the front-month. "Implied U.S. output increases...will offset a significant portion of the planned OPEC production cuts especially since we don't anticipate sustained strong compliance," Jim Ritterbusch, president of Chicago-based energy advisory firm Ritterbusch & Associates, said in a note.