Low Crude Oil Prices News

Mideast demand especially strong due to refinery outages. Rates for tankers carrying refined fuels like gasoline and diesel have soared this month as trade activity picked up and caused a supply crunch in ships, several shipbrokers and traders said. The high rates indicate strong consumer fuel demand due to the persistently low crude oil prices that have resulted from years of oversupply, refiners said. "Our order books are pretty good. Whether it's gasoline for cars or diesel for industry, we're receiving calls to ship more fuel," said one shipper based in Singapore. Rates for medium-range (MR) tankers carrying about 30,000 tonnes of oil products like gasoline…

Overall confidence levels in the shipping industry fell to a record low in the three months to February 2016, according to the latest Shipping Confidence Survey from international accountant and shipping adviser Moore Stephens. The average confidence level expressed by respondents in the markets in which they operate was 5.0 on a scale of 1 (low) to 10 (high). This compares to the 5.6 recorded in November 2015, and is the lowest rating in the life of the survey, which was launched in May 2008 with a confidence rating of 6.8.

Moody's Investors Service has changed its outlook on the global shipping sector to negative as it expects supply growth to outpace demand growth in 2016 by more than 2 percent, suppressing freight rates, particularly in the dry bulk and containership segments. However, the outlook for the tanker segment remains stable as low crude oil prices will continue to boost demand for tankers. "Even though the tanker segment continues to perform strongly, we expect the supply-demand gap for the industry overall to exceed 2 percent in 2016, and possibly into 2017, as large new vessel deliveries coincide with subdued demand for dry bulk and container ships," Moody's said quoting Marie Fischer-Sabatie, senior vice president in its report.

In its latest weekly report, London-based shipbroker Gibson noted on China that “certainly, Chinese manufacturers have lost their appetite for commodities which has impacted heavily on demand for coal, iron ore and copper with an obvious impact on the dry cargo market. China has taken advantage of the low crude oil prices to fill both their strategic reserve as well as commercial inventories. Crude oil imports to China hit a record 7.6 million b/d in July and are anticipated to remain at elevated levels into second-half of 2015 despite the slowdown in economic growth. The People’s Republic is continuing to build vast storage caverns to house the expanded strategic petroleum reserve (SPR) which will continue to support crude imports and thus VLCC trade.

Cosco Corporation has warned investors of an expected net loss for the second quarter ended 30 June 2015, as against a profit in the previous corresponding period. The company said the loss is mainly due to the low crude oil prices over recent months which have had an adverse impact on the global offshore marine industry. Further details of the Company’s financial performance will be disclosed when the Company announces its 2Q 2015 Results, which are scheduled to be released July 31.

ConocoPhillips said on Thursday it will reduce future spending on deepwater drilling due to low crude oil prices while raising its dividend one cent.   The largest spending reductions will come in the Gulf of Mexico, where the Houston-based company said it will terminate a three-year contract for an Ensco deepwater drill ship that was due to be delivered late this year.   Conoco said it raised its quarterly dividend to 74 cents per share from 73 cents per share.     (Reporting by Anna Driver, editing by G Crosse)

Suezmax tankers are looking good for a strong 2015 year, before posting a mild downside during 2016, but are poised to accelerate yet again in 2017 on rising deliveries, said shipbroker Charles R. Weber in its latest weekly report (Ref. “Suezmax earnings continued to experience surprising strength during the first quarter of the year with an average of ~$46,951/day exceeding our early-January projection by 15%. Through the full year, we have raised our projected average by 6% to ~$37,200/day. During 2016 and 2017 we project averages of $35,375/day and $31,000/day, respectively”, said the shipbroker. Suezmax earnings have strengthened in recent months…

Tumbling prices and oversupply may be cause for concern in the oil industry, but shipping industry it can represent a window of opportunity. A simple statistical data can put things in perspective for you: Two out of every three barrels of oil that are transported are moved around in ships. The remaining one-third is transported via pipelines. Therefore, the shipping industry plays a crucial role in the integrated oil business. To start with, the cost of shipping could go down thanks to the current slide - this is what a study by Middle East's The National shows. Malaysia's MIDF Equities Research shipping sector is set to benefit from the current low crude oil prices. It doesn't have a direct instant impact on shipping, but the situation augers well for maritime sector.

report (ending 18 April) from the US. reported an even bigger gain of 13.1 mb. remain uncomfortably low. just three weeks earlier. inventories to normal". million barrels, i.e. years. Stocks of gasoline and distillates are also down for the time of year. closer to "normal". past 2 years, although only slightly so far this year. and more than 1 mbd of imports. and May until increased demand starts drawing down inventories. which in turn means less crude will be going into storage. towards winter, as distillate stocks remain very low for the time of year. year and 16.6% below the 5-year average. summer to rebuild inventories to more comfortable levels". before the war. considerably lower in the next couple of weeks than the record of last week.