The 400,000 b/d of crude exports most threatened by the intensifying battle around Tripoli may avoid disruption. Haftar’s interest in Tripoli is political and financial power. Attacking these ports would be a distraction and would undermine his own interests. For the months ahead, we forecast Libya’s oil production will remain stable at just under 1 million b/d.
After falling by 250,000 b/d last year, European refinery throughput is slated to remain flat this year at 12.4 million b/d. In 2020, we expect significant IMO-driven year-on-year growth in run rates during the first half of the year to be offset by declines in the latter half of the year such that throughput remains more or less stable on an annual basis.
Sanctions on Venezuela and Iran, the coming IMO specification change, and the likely OPEC action are impacting the global crude oil outlook through 2020.
China petchem investment takes center stage in the outlook for NGLs in 2020
Growth from the Permian is expected to slow down slightly, averaging around 650,000 b/d over the next two years due to subdued productivity gains and investor pressure to rein in spending. This will bring West Texas Light (WTL) production to about 680,000 b/d or about 14 percent of the total. Tremendous pipeline capacity expansion will likely make quality batching easier, but still result in under-utilization out of both the Permian and the Rockies. Meanwhile, further pipeline expansion delays threaten Canadian Oil Sands production.
ESAI Energy estimates that distillation capacity will rise by nearly 1.4 million b/d per annum in 2019 and 2020. The majority of this new capacity is being added in Asia and the Middle East and it will significantly outpace global demand for crude derived products. As a result, it will begin to put pressure on global utilization rates, despite higher throughput expectations linked to IMO. Most new capacity in Asia and the Middle East, including petchem-integrated units in the former, will process medium/heavy crude from the Middle East. This will make it challenging for U.S. exports to further penetrate the market. Among other things, this means U.S. exports will seek to displace competing suppliers at existing refineries.
Bloomberg: An alliance of countries that includes Russia is cutting oil production to end a global glut. One of the big winners: the nation’s own crude exporters.
In 2020, the IMO sulfur cap on marine fuels will usher in significant changes to global fuels demand, pricing, and trade. This month’s Global Fuels Two-Year Outlook highlights our explicit forecast of changes in bunker demand for marine gasoil, HSFO and LSFO and examines the future of product markets more broadly through 2020.
Bloomberg:Russia says its on track this month to fullyimplement the production cuts promised in the OPEC+ accord, yetits crude exports will be almost as high as before the deal,according to consultant ESAI Energy LLC. The irony of thesituation “will not be lost on the Saudis,” ESAI’s principalanalyst Andrew Reed said in a note. As the Middle Easternkingdom keeps a tight lid on its own shipments, Russia will sendmillions of extra barrels overseas in April as its domesticrefineries process less fuel, partly due to prolongedmaintenance at a major refinery owned by Rosneft PJSC, he said.
After rising by 160,000 b/d last year, European demand for transport fuels will rise by 100,000 b/d this year to an average of 9.7 million b/d as gasoline and jet fuel demand growth decelerates and residual bunker consumption falls outright. This slowing trend will continue through 2020, when European transport fuel consumption growth grinds to a halt, buffeted by economic headwinds.
China’s crude imports in March declined to 9.26 million b/d due to refinery maintenance season. With maintenance peaking in mid-May, crude imports could slow to around 9 million b/d in the next two months. Meanwhile, weak domestic diesel demand and an adjustment to the export quota for that product suggest diesel exports could rise to 580,000 b/d.
Progressive Farmer: Under OPEC+ accord, Russia agreed to shoulder more than 50% of the total non-OPEC cuts, which stands at 400,000 bpd. However, it has since struggled to reach the agreed quota, due to reported opposition from domestic oil industry. According to ESAI Energy, Russian crude exports are expected to reach a multi-year high of 5.7 million bpd in April, driven by greater flow of Russian crude into Asia in a bid to expand market share. Higher export rate comes as Russian oil producing companies finally achieved full compliance with their quota of 228,000 bpd cut in March.
Oilfield Technology: Russian crude exports will reach a multiyear high of 5.7 million bpd in April, 400 000 bpd higher than average exports in the previous 5 months, according to a Market Alert released by ESAI Energy. Among other things, unusually high exports have implications for market share in Asia. As the past few years’ fluctuations in Russian exports have shown, unusually high exports are accompanied by greater flows of Russian crude into Asia.
Oil and Gas Journal: Russian crude exports will reach a multiyear high of 5.7 million b/d in April, 400,000 b/d higher than average exports in the previous 5 months, according to a market alert released by ESAI Energy.
World Pipelines: Russian crude exports will reach a multiyear high of 5.7 million bpd in April, 400 000 bpd higher than average exports in the previous five months, according to a Market Alert released by ESAI Energy. Among other things, unusually high exports have implications for market share in Asia. As the past few years’ fluctuations in Russian exports have shown, unusually high exports are accompanied by greater flows of Russian crude into Asia.