Oil Prices News

02 Apr 2020

While Oil Prices Plummets, Tanker Rates Fly High

Source: BIMCO, Clarksons

If one ever needed proof that, no matter how dire the situation, there is always a silver lining, look no further than the crude tanker market, which has seen it day rates skyrocket in the face of a global pandemic that has effectively ground world commerce to a crawl.As is the case with other gravity defying business phenomena, geopolitics is a central factor, in this case a battle between Russia and Saudi Arabia to flood the world with oil in the face of declining demand and…

02 Apr 2020

Long-Term Charter with Total for Havila PSV

Havila Commander - Image by Alan Jamieson/Flickr - Shared under CC BY 2.0 license

Norwegian offshore vessel owner Havila Shipping has secured a long-term contract for its platform supply vessel Havila Commander.Havila Shipping said Thursday that the contract was with Total E&P UK, the UK subsidiary of the French oil major Total.The new contract for the 2010-built platform supply vessel is for a firm period of 18 months. The contract will begin in mid-April 2020 in direct continuation of its current contract.The 85 meters long Havila Commander PSV has worked for Total E&P UK since April 2012.

01 Apr 2020

US Shipyards Forge Ahead Through COVID-19

The 56-foot icebreaking tugboat being built by Blount Boats for N.Y. Power Authority (NYPA). (Photo: Blount Boats)

As the novel coronavirus and its impacts continue to spread across America, U.S. shipbuilders, by and large, continue to build. While most yards have been deemed essential to marine transportation and/or national security and have been able to maintain operations, the situation at and around every shipyard is different, and there are several builders across the country that have had to temporarily suspend activity. In either scenario, it’s far from business as usual for America’s…

31 Mar 2020

Abu Dhabi's Gulf Marine Services Reaches Debt Restructuring Deal

A GMS self-elevating rig - Image credit: GMS

Abu Dhabi-based Gulf Marine Services (GMS) said on Tuesday it had reached an agreement with its syndicate of banks to restructure its debt that will help it weather the coronavirus crisis.London-listed GMS provides support vessels for offshore oil and gas and other energy installations. It has been hurt by a downturn in the oil and gas services industry triggered by a prolonged slide in oil prices that has turned into a deep slump since the coronavirus crisis destroyed demand…

31 Mar 2020

Oil Economics: Freight Rate Surge Cuts into Trader's Profits

© Björn Wylezich/AdobeStock

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…

30 Mar 2020

Shell to Exit Lake Charles LNG Project

Royal Dutch Shell said on Monday it will exit the Lake Charles liquefied natural gas export project in Louisiana, citing the plunge in oil prices due to the coronavirus pandemic.The project is a 50-50 venture with U.S. midstream company Energy Transfer, which said in a separate statement it will take over development of the project.(Reporting by Shradha Singh in Bengaluru; Editing by Aditya Soni)

30 Mar 2020

Nigeria Announces Offshore Oil Worker Restrictions to Battle Coronavirus

© Jan/AdobeStock

Nigeria's petroleum regulator has ordered oil and gas companies to reduce their offshore workforce and move to 28-day staff rotations as part of measures to curb the spread of the coronavirus, according to a circular seen by Reuters.Health experts fear a widespread outbreak in Africa's most populous country, which has about 200 million inhabitants, and the country is keen to protect oil production, which provides 90% of much-needed foreign exchange.A coronavirus case on an offshore rig could spread quickly among workers and have a potentially devastating impact on production.Sarki Auwalu…

27 Mar 2020

Valaris to Lose $620,000 a Day Rig Deal with Total after BOP Drop off Angola

Valaris DS-8 (formerly known as Ensco DS-8) - Credit: Harvey Wilson - MarineTraffic

Valaris, the world's largest offshore drilling company by fleet size, is set to lose one of the most lucrative contracts in the offshore drilling industry today after it recently accidentally dropped a blowout preventer stack to seabed offshore Angola.The contract, at a day rate of $620,000 per day, is with the French oil major Total for the drillship Valaris DS-8. The Samsung GF12000 designed drilling rig has been drilling for Total since 2015.As previously reported, Valaris earlier in March said it had accidentally dropped Blowout Preventer Stack to the seafloor of Angola…

26 Mar 2020

Brent's Fall Creates Steepest Contango in 11 Years

Oil Tanker - Image by Gudellaphoto - AdobeStock

The discount on front-month Brent crude oil futures to later contracts increased to an 11 year high on Thursday, as the coronavirus pandemic continued to cause an unprecedented slump in global demand. The spread on the May to November contracts had widened to as much as minus $10.31 per barrel at 1004 GMT, a level not seen since January 2009. The so-called contango market structure implies traders expect oil prices to be higher in the future, in this case when the virus pandemic has hopefully passed, leading them to store crude onshore or in some cases at sea.

23 Mar 2020

Oil, Fishing, Tourism: Alaska Economy Faces Triple Hit from Coronavirus

© Stephen Finn/AdobeStock

The U.S. state of Alaska is so far distant from the worst medical ravages of the coronavirus pandemic, but its economy is in critical condition. Alaska is especially vulnerable because it depends on oil, tourism and fisheries – basic industries that are reeling from the global coronavirus pandemic – and the state government gets most of its revenue from investment earnings that have now evaporated."Alaska is experiencing a perfect storm, a most terrible trifecta, the hat trick from hell," said state Senator Natasha von Imhof, co-chair of the Senate Finance Committee, at a hearing Saturday.

21 Mar 2020

IMF: Global Impact of COVID-19 will be Severe, but Temporary

© Funtap/AdobeStock

As many markets struggle to find their footing in the face of the global COVID-19 pandemic, a recent podcast with Martin Muhleisen, director of the IMF's Strategy, Policy, and Review department, helps to lend insight and perspective from the view of the International Monetary Fund.Muhleisen  said the impact of the global coronavirus pandemic will be “quite severe,” but temporary, saying that the overall good health of the world economy and high employment rates should help to provide buffers to blunt the impact“I would think that financial institutions more broadly are in a better shape than…

19 Mar 2020

Shipping Not Immune to a Pandemic -BIMCO

© donvictori0 / Adobe Stock

The World Health Organization (WHO) has declared the outbreak of the novel coronavirus a pandemic. There is little doubt that this will have significant implications for the shipping industry. But to what extent? BIMCO expects that the strict containment measures imposed by governments around the world will result in substantially lower global economic growth and consequentially, lower demand for shipping. Container and dry bulk shipping are at the front line when it comes to feeling the fallout…

19 Mar 2020

Most Bunker Sales in Singapore are Low-sulphur Fuels -BIMCO

© Rex Wholster / Adobe Stock

Low-sulphur fuels accounted for 84% of total February sales in Singapore, slightly up from 83% in January. The sale of low-sulphur fuel oil (LSFO) made up the largest component at 71.5%, with marine gas oil (MGO) accounting for 12.5%, BIMCO reports.Total bunker sales in February fell 16% to 3.9 million metric tons compared with January, reflecting lower demand for shipping as the coronavirus paralyzed intra-Asian supply chains.Now that both the sulphur cap and the non-compliant fuel oil carriage ban have come into force…

18 Mar 2020

Rewrite the Rules: The Path to Zero Emissions

First-of-its-kind cargo vessel Captain Ben Moore delivers local produce and food across Long Island Sound. Built by Derecktor Shipyards, the aluminum catamaran is powered by two Cummins QSB 6.7 diesels, and lithium batteries connected to a pair of BAE Systems HybriDrive electric motors.  (Credit: Harbor Harvest)

With social media updates and conference agendas addressing the subjects of climate change, emissions reductions and alternative fuels, it’s a wonder we are not climbing the Himalayans in search of the Jedi Master that will provide us with the magic potion. Yoda’s blessing with a calming breath, “You have chosen wisely.”Government emissions intervention started with a move to reduce energy and fuel consumption measured in greenhouse gas (GHG), at a time when the world and our politicians spoke about global warming.

18 Mar 2020

BIMCO Revises 2020 Forecast

© Igor Yu. Groshev / Adobe Stock

The coronavirus pandemic is impacting global shipping demand for 2020 negatively. The speed of the virus spread makes it difficult to assess the full consequences. Nevertheless, we see a need to update our 2020 forecast to make some of this massive uncertainty tangible.What is going on in addition to the coronavirus pandemic?Geopolitical tensions that made the OPEC+ alliance break down, has subsequently made the crude oil tanker spot freight market erupt. The events that followed the breakdown - and those that are likely to follow…

16 Mar 2020

TechnipFMC Shelves Spin-off Due to Market Turmoil

(Photo: TechnipFMC)

Franco-American oil services firm TechnipFMC Plc is putting on hold plans to split itself into two due to turbulence in financial markets linked to the coronavirus outbreak, it said on Sunday.The group, created three years ago via the merger of Technip and FMC, had been planning to separate its engineering and construction activities from its upstream oil services business in the first half of this year."Market conditions have changed materially due to the COVID-19 pandemic, the sharp decline in commodity prices, and the heightened volatility in global equity markets," TechnipFMC said in a sta

12 Mar 2020

Booking Frenzy Sends Tanker Rates Soaring

© Vladimir / Adobe Stock

The cost to transport oil on supertankers soared on Thursday as major producers scrambled to secure vessels to ship more crude in a bid to regain market share and buyers took advantage of plunging oil prices.Freight charges to ship oil in very large crude carriers (VLCCs) from the Middle East, which is home to the largest OPEC producers, to China, the world's top crude oil importer, nearly doubled overnight.VLCC tanker rates along the busy Middle East Gulf to China route jumped to about $160…

11 Mar 2020

Shell in Talks to Book Tankers for Crude Floating Storage

© Suriyapong / Adobe Stock

Royal Dutch Shell is in discussions to charter at least three supertankers to store around 6 million barrels of crude oil at sea, shipping sources said on Wednesday.Shell has provisionally booked the vessels, known as very large crude carriers (VLCCs), for storage options for at least three months, the sources said, adding that the fixtures were still to be concluded.A Shell spokeswoman declined to comment.If fully fixed, these would be the first tankers to be used for floating…

20 Feb 2020

Global Container Demand to Grow by 1-3% in 2020

Image: A.P. Moller - Maersk

For 2020, global container demand is projected to grow by 1-3%, as per forecast by A.P. Moller - Maersk.The continued weak global sentiment above all in the manufacturing sector reduces the likelihood of a material growth pick-up in 2020, although sentiment brightened a bit at the end of 2019, and some improvement can be expected on the back of stabilizing inventory dynamics, said the shipping giant.Aside from the cyclical slowing of the global economy, substantial risk to global container demand comes from the effectiveness of fiscal and monetary policy in major economies…

13 Feb 2020

Oil Prices Climb on Hopes of Deeper OPEC+ Production Cuts

AdobeStock_45230 / Adobe Stock

Oil prices edged higher on Thursday as investors focused on the possibility of deeper supply cuts from the world's biggest producers, whilst largely shrugging off reports which cut demand forecasts after the coronavirus outbreak in China, the biggest oil importer.Brent crude was up 32 cents, or 0.6%, at $56.11 a barrel by 10:52 a.m. ET (1552 GMT), while U.S. West Texas Intermediate (WTI) was up 14 cents at $51.31 a barrel.The energy complex was led higher by U.S. gasoline futures…

23 Jan 2020

Low-sulphur Fuel Oil Prices Drop

© Igor Yu. Groshev / Adobe Stock

Prices for very low sulphur fuel oil (VLSFO) in ports around the world have fallen within the first month since the International Maritime Organization's (IMO) new regulation for a 0.50% global sulphur cap for marine fuels has taken effect.Singapore has seen one of the largest drops in the price of VLSFO, which peaked on January 7, 2020 at $740 per metric ton (MT) and dropped $99 to $641 per MT on January 22, BIMCO points out.Prices rose in December as shipowners transitioned…

24 Jan 2020

Coronavirus Places Shipping on High Alert

Ports in Singapore have started screening inbound travelers on passenger and commercial vessels for coronavirus symptoms (© hit1912 / Adobe Stock)

The Wuhan coronavirus outbreak has placed the shipping industry on high alert amid a rising death toll in China and reports that the fast-spreading illness is reaching new shores.The flu-like coronavirus, first identified in Wuhan, Hubei Province, China on December 31, has killed more than two dozen people in China and is believed to have infected more than 900 worldwide, according to several media reports. Cases have been confirmed in Beijing, Shanghai and Guangdong, and internationally in travelers returning from China to Japan…

25 Dec 2019

Saudi Aramco, Korea Shipbuilding Roll-out New JV

Image: Saudi Aramco

Korea Shipbuilding & Offshore Engineering (KOSE), a manufacturer of oil tankers, cargo and passenger vessels, and warships, and Saudi Arabian Oil Company (Saudi Aramco) plans to set up a joint venture to build engines.According to South Korea’s Yonhap News Agency the JV will break ground for the plant in the King Salman International Complex for Maritime Industries and Services in the kingdom’s eastern coast in September 2020, and the project is set to be completed in May 2022.The Korean company is working to build a shipyard at the complex through a separate JV with Saudi Aramco…

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