Tag: Community

IMO 2020 may not solve crude oil quality riddle: Fuel for Thought

The global chasm in crude oil quality supply shows no signs of narrowing, prompting refiners to lighten their slate and leading to a market awash with gasoline , naphtha and LPG. New restrictions next year on the amount of sulfur in global marine fuels may mean refiners buy even more US shale oil , but this may not put an end to a saturated light ends market. Much hinges on demand. The meteoric rise in US production over the past decade — almost doubling to record highs of around 12 million b/d — shows little sign of slowing in the... continue reading

The U.S. Gulf Coast became a net exporter of crude oil in late 2018

In the last two months of 2018, the U.S. Gulf Coast exported more crude oil than it imported. Monthly net trade of crude oil in the Gulf Coast region (the difference between gross exports and gross imports) fell from a high in early 2007 of 6.6 million barrels per day (b/d) of net imports to 0.4 million b/d of net exports in December 2018. As gross exports of crude oil from the Gulf Coast hit a record 2.3 million b/d, gross imports of crude oil to the Gulf Coast in December—at slightly less than 2.0 million b/d—were the lowest level... continue reading

Energy and commodities highlights: CERAWeek, US sanctions and EU energy laws

As energy industry professionals gathered in Houston for CERAWeek, global oil politics was top of the agenda. Policymakers and market participants saw opportunities for the US to grow its oil and gas exports amid geopolitical turbulence. Developments on Iran sanctions were a key question hanging over the event, as the market awaits further news on waivers for key importers of Iranian crude. And the US’s request that India cut its Venezuelan crude oil imports has raised the possibility that it could take a softer line on Indian purchases of Iranian oil. Meanwhile, Japan this week looked poised to take a... continue reading

U.S. Gulf Coast refinery demand for hydrogen increasingly met by merchant suppliers

Petroleum refineries in the U.S. Gulf Coast increasingly rely on merchant suppliers, rather than their own production, to provide the hydrogen used to reduce the sulfur content of fuel. As global demand for distillate fuel oil has increased and sulfur content regulations have become more stringent, refineries have needed to use more hydrogen. Hydrogen demand is expected to continue to rise as International Maritime Organization regulations that limit the sulfur content in marine fuels take effect on January 1, 2020. Source: Today in Energy – U.S. Gulf Coast refinery demand for hydrogen increasingly met by merchant suppliers... continue reading

MiFID II updates, CFTC position limits

While there is not much news relating to MiFID II specifically for those in energy and commodities, the wider financial services world has seen a great deal of discussion and activity since the first anniversary of the rules took place (see here). Any Investment Firm (which includes some energy and commodity market participants) needs to … Continue reading → Source: Energy Trading Regulation – MiFID II updates, CFTC position limits... continue reading

U.S. natural gas production hit a new record high in 2018

U.S. natural gas production grew by 10.0 billion cubic feet per day (Bcf/d) in 2018, an 11% increase from last year. The increase was the largest annual volumetric growth on record and reached a record high for the second consecutive year. U.S. natural gas production measured as gross withdrawals averaged 101.3 Bcf/d in 2018, the highest volume on record. U.S. natural gas production measured as marketed production and dry natural gas production also reached new highs at 89.6 Bcf/d and 83.4 Bcf/d, respectively. Source: Today in Energy – U.S. natural gas production hit a new record high in 2018... continue reading

Toxic air catastrophe triggers scrap metal revolution in China

Minerals producers have made fortunes over the last decade to slake China’s thirst for raw industrial metals. But in the future their profits could be hit by the Middle Kingdom recycling ever-greater quantities of its own ferrous scrap to meet industrial demand and, more importantly, cut dangerous pollution levels. It is an interesting time to be a scrap dealer in China. The market for recycled metal in the world’s second-largest economy is booming. Demand for steel scrap for smelting into new material in China surged by almost 40% in the first nine months of 2018 to around 150 million mt,... continue reading

More Brexit updates: FCA announcements

The news around Brexit now comes out on an hourly basis (for example see here on Sky News). A “no deal” Brexit remains very possible. As a result, following last week’s announcements (see here), the UK’s Financial Conduct Authority (FCA) has made several of their own, in particular around EMIR and MiFID II: EMIR The … Continue reading → Source: Energy Trading Regulation – More Brexit updates: FCA announcements... continue reading

The United States imports and exports substantial volumes of petroleum

U.S. net trade of petroleum, which includes crude oil, petroleum products, and natural gas plant liquids, has fallen in recent years, reaching 2.3 million barrels per day (b/d) in 2018. This level is the lowest level of net petroleum trade (imports minus exports) since 1967. At the same time, total U.S. gross petroleum trade (imports plus exports) have reached an all-time high of 17.5 million b/d in 2018. The result has been a growing role for the United States in world petroleum trade. Source: Today in Energy – The United States imports and exports substantial volumes of petroleum... continue reading

Big Oil braces for fresh pressure over climate strategy, diversity

Life doesn’t seem to be getting any easier for hydrocarbon producers despite their return to bumper earnings from firmer prices. As energy executives prepare to face activist investors at annual general meetings next month, pressure for faster change seems to be coming from all angles. Already under siege to de-carbonise their long-term business models, Big Oil is still struggling to attract talent and overhaul its male-dominated management structures. With the AGM season fast approaching, climate-change related proposals from US investor groups alone are expected to hit a new record of over 90 this year, up from up from 36 in... continue reading

In the LOOP: West Canadian Select price on US Gulf Coast hits new high

Price differentials for heavy, sour Western Canadian Select on the US Gulf Coast have reached their highest levels on record as Albertan production curtailment, Venezuelan political upheaval and OPEC production cutbacks have created a tight supply of heavy sour grades in the region. WCS at Nederland, Texas, was assessed Monday at the NYMEX WTI CMA plus $3.50/b, its strongest ever differential, according to S&P Global Platts data going back to 2016. Since trading at parity with the WTI CMA on February 7, WCS at Nederland, Texas, has steadily strengthened as the market reacted to the high demand and short supply... continue reading

Increases in natural gas production from Appalachia affect natural gas flows

The 2019 Annual Energy Outlook (AEO2019) Reference case shows continued growth of natural gas production in the Mid-Atlantic and Ohio region from the Marcellus and Utica formations, resulting in increases of natural gas being transported to the Eastern Midwest and, ultimately, into the South Central region, which includes the Gulf Coast and Texas. Source: Today in Energy – Increases in natural gas production from Appalachia affect natural gas flows... continue reading

Insight from Washington: US refiners worry about White House wild card as IMO 2020 nears

A strict sulfur limit for marine fuels starting in 2020 and its potential to boost US gasoline and diesel prices may have caught the White House off guard last year, but it’s not taking refiners or members of the shipping industry by surprise. US refiners say they have been preparing for the International Maritime Organization’s 0.5% sulfur cap for a dozen years by making billions of dollars of investments to their plants. They also think US oil producers are well positioned to meet new global demand for lower-sulfur fuels. Despite the industry’s confidence, Gulf Coast refiners are nevertheless skittish about... continue reading

More than 60% of electric generating capacity installed in 2018 was fueled by natural gas

Based on EIA’s December 2018 monthly electric generator inventory of utility-scale generation, 31.3 gigawatts (GW) of generating capacity were added in the United States in 2018 and 18.7 GW of capacity were retired. The 2018 annual capacity additions were the largest since 48.8 GW were added in 2003. Most of the additions happened in the second half of the year, while the retirements occurred mostly in the first half. Source: Today in Energy – More than 60% of electric generating capacity installed in 2018 was fueled by natural gas... continue reading

Energy and commodities highlights: All eyes on India, US trade talks, Nord Stream 2

India and Pakistan’s tense relationship returned to the headlines recently, and while the latest incident had little impact on commodity markets, it brought into focus India’s role as a fast-growing market for raw materials. Saudi Arabia quickly set diplomatic wheels in motion to defuse the situation. Aside from the clear interest in preventing fresh conflict from erupting close to home, Saudi Arabia expects India to become an increasingly important export market for its oil, and is also planning huge refining and petrochemicals investments in India. Meanwhile the US is eyeing India as a potential sink for its rising oil output,... continue reading

Brexit update – C6 carve out, NRA REMIT letters and more

The political side of Brexit still has not produced a concrete result (for example, see here on Sky News). With three weeks to go until the Brexit date of 29th March 2019, the majority of the market is preparing for a “no deal” scenario. Never the less, some thought is also being put into what … Continue reading → Source: Energy Trading Regulation – Brexit update – C6 carve out, NRA REMIT letters and more... continue reading