Crude oil demand reaches plateau
Global oil demand growth is expected to taper off, Julianne Geiger said quoting the latest report from IHS Markit, the world’s largest energy consultancy.
Global oil demand is currently sitting at 89 per cent of pre-pandemic levels, it said. It is then expected to rise and level off at between 92pc and 95pc of the demand pre-pandemic.
Oil demand growth, therefore, will wane and plateau through Q1 2021 as fewer people are commuting to work, and as air travel slumps considerably amid remaining travel restrictions and people’s subdued appetite for air travel—particularly international air travel, Geiger underlined.
Oil demand hinges largely on jet fuel and US gasoline demand. And so far in 2020, global jet fuel demand and gasoline, though, have rebounded from April, yet the global jet fuel demand is still off 50pc year to date. The US gasoline demand is also down, though by a lesser amount, but still significant, at around 20pc, despite rebounding from its April lows, at the height of the US lockdowns.
Global oil demand is expected to remain depressed into 2021 as airplane travel and work commutes have yet to recover from the coronavirus pandemic, Paul Takahshi underlined too, quoting the IHS report.
However, Matthew V. Veazey of Rigzone, looked at the same IHS Markit report, rather differently, saying the global oil demand has grown at a record pace – by 13 million barrels per day (mbpd) – in the past four months since the nadir of the Covid-induced collapse in April.
Presently at 89pc of pre-Covid levels, global oil demand has risen from 78pc in April, IHS noted in a written statement emailed to Rigzone, with the demand expected to level off at 92 to 95 mbpd through the first quarter of 2021. As per the Rigzone report, the anticipated plateau in demand will stem primarily from subdued air travel and commutes.
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India should move away from coal use: UN
The global body wants the south Asian country to take the lead in pushing for clean energy, especially as the Covid-19 pandemic is putting sustainable development at risk, its secretary-general António Guterres said on 28 August.
The pandemic has dented India’s plans to rapidly expand its renewable fleet as construction activities were slowed by labour shortages and supply chain problems. But at the same time, Delhi is not backing down on its big reform plan to allow the private sector into commercial coal mining to help boost domestic output and cut imports.
The country launched a tender to auction more than three dozen coal blocks in June, with bids likely to be opened in late August. But those deadlines were shifted, mainly because some interested bidders cited difficulties amid the pandemic and asked for more time to survey the listed blocks. The last date of submission of bids has been extended to late September.
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Ukraine wheat export prices up $5 over the last week – APK-Inform
Ukrainian wheat export prices have risen $5 per tonne over the last week due to higher demand from importers, analyst APK-Inform said on Monday.
APK-Inform said in a report that Ukrainian 12.5 protein wheat was traded at around $204-207 per tonne FOB Black Sea. Wheat with 11.5 protein content added $5-$6 per tonne to $203-$206 per tonne FOB Black Sea, the consultancy said.
Ukraine harvested a record 75.1 million tonnes of grain in 2019 but sees the 2020 harvest falling to around 70 million tonnes due to unfavourable weather.
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The economy ministry said last week that Ukraine’s 2020/21 July-June season grain exports fell by 22 percent to 5.93 million tonnes as of Aug. 26.
Ukraine is the world’s fourth-largest wheat exporter and sold abroad a total of 56.5 million tonnes of various grain in the 2019/20 season. The government has not given a grain export forecast for 2020/21.
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Kazakhstan extends uranium production cut through 2022
Kazakhstan’s national operator for the import and export of uranium, Kazatomprom, has announced this week the company’s intent to extend production cut by 20 percent through 2022 in an effort to balance the global uranium market.
“We are simply not seeing the market signals and fundamental support needed to ramp up mine development in 2021 and take our low-cost, tier one production centers back to full capacity in 2022,” he added.
The new regulations are expected to remove up to 5,500 tons of uranium from the anticipated global primary supply in 2022, with uranium production in Kazakhstan staying similar to the level expected in 2021 and ranging between 22,000 and 22,500 tons, according to the statement.
In early April, the company announced that its facilities across Kazakhstan would be working at reduced capacity within three months which was expected to cause production cuts by about 17.5 percent in 2020. The statement was made in the wake of a state of emergency declared in Kazakhstan due to the novel coronavirus outbreak. Before the lockdown, the company was expecting the production output to reach about 22,800 tons in 2020.
The country of almost 19 million people, Kazakhstan has reported more than 103,000 cases of infections with the fatality rate standing at 1,415 as of August 20. Harsh restrictions introduced by the country’s government to contain the spread of the deadly virus halted most economic activities, causing many people to lose their jobs. A range of companies has announced a temporary halt on production in their local manufacturing facilities until further notice.
Officials in Kazatomprom are convinced that uranium prices and long-term contracting activity will remain unsustainably low due to the market uncertainty attributed to the COVID-19 pandemic. The company has not taken any decision regarding mine development activity beyond 2022 as it continues to monitor market conditions.