Oil gains despite mounting US-China trade tensions
il prices rose on Friday despite the start of U.S. President Donald Trump’s tariff hike on $200 billion of Chinese goods, stoking the trade dispute between the world’s two biggest economies. China on Friday said it “deeply regrets” the U.S. move, adding that it would take necessary countermeasures, without elaborating. Prices were supported by tighter supply amid ongoing production cuts by the Organization of the Petroleum Exporting Countries (OPEC) and U.S. sanctions on Iran and Venezuela. The Brent crude oil benchmark was at $70.73 a barrel at 0643 GMT, up 34 cents, or 0.5%, from its last close, after rising as far as $71.23 a barrel. U.S. West Texas Intermediate (WTI) crude futures were up 39 cents at $62.09 per barrel, having earlier hit $62.49 a barrel. Brent is down slightly on the week, on course for its second weekly loss, while U.S. crude is set for a weekly gain of 0.2% in what would be its first gain in three weeks. Growing trade between the world’s two largest oil consumers could impact oil demand. The two countries combined to make up 34% of global oil consumption in the first quarter of 2019, according to data from the International Energy Agency. “(Still) crude prices are likely to be supported on geopolitical risks,” said Edward Moya, senior market analyst at futures brokerage OANDA. “We could see the Iran situation be the biggest bullish catalyst for oil prices,” he said. “With the ending of the U.S. sanction waivers becoming effective this month, Iranian shipments are falling sharply.” The United States reimposed sanctions on Iran in November after pulling out of a 2015 nuclear accord between Tehran and six world powers last year, although it allowed Tehran’s biggest buyers to continue buying some crude oil via waivers for another six months. But those exemptions ended at the beginning of May, as Washington aims to cut Iran’s oil exports to zero. Meanwhile, efforts by OPEC to crimp supply to reduce global inventories have also supported prices. Markets have been buoyed further by expectations oil demand will rise in 2019. The U.S. Energy Information Administration expects global appetite for oil to rise by 1.4 million barrels per day this year.
CNG and LPG vehicles can be at the forefront of transforming mobility in India, says Nomura
The report finds that the existing volume of oil import is posing a monetary as well as a strategic burden on the Indian economy leading to an imminent need to reduce import dependence. It says that while EV adoption can be a potential solution to this issue, the pace of adoption and financial viability still raises many questions. “NGV’s (Natural Gas Vehicles) can play a big role in transforming mobility in India, as an automobile fuel, natural gas is a proven technology in terms of providing better air quality, sustainability and eco-friendliness. A favourable policy is required for promotion of natural gas vehicles (NGVs) through development of CNG infrastructure to increase customer acceptance and provide cost competitiveness,” said Ashim Sharma – Partner and Group Head, NRI Consulting & Solutions India. It says that the primary energy consumption in India is largely dependent on coal and imported crude oil, the report further highlights the transport sector as one of the major contributors to the crude oil burden as it makes up for around 53 percent of demand of petroleum products. On the other hand, globally the natural gas resources is available in abundance (796 TCM) and is geographically dispersed, where India holds around 4 TCM of gas reserves. While, global production of NG (natural gas) has risen steadily over the years, in India the production has declined since 2011 due to reduced production from KG basin. It says although around 50 percent of natural gas is imported, the per unit energy import cost is 44 percent cheaper than crude oil and is expected to remain the same. CNG and LPG as an alternative fuel The CNG vehicle in the country has risen over the years. The CNG infrastructure acts as the main driver for CNG vehicle demand, which has led to OEMs increasingly offering CNG variants in passenger, commercial and goods vehicle segments. In addition, CNG retro fitment technology can be leveraged to convert existing vehicles running on conventional fuels. This will help as many as 7 states benefited after the 10th round of CGD (City Gas Distribution) making up for 55 percent of the total vehicle sales in the country as of FY2018. After the 9th and 10th round, CGD infrastructure will cover 52 percent area and 72 percent population and will make natural gas accessible across the country. Nomura’s finding predicts that the cost competitiveness, infrastructure development and domestic manufacturing will make LNG a promising alternative for long-haul trucks and intercity buses. Due to the higher energy density of LNG, these vehicles will have a longer driving range than that of CNG and will require cryogenic tanks to store the fuel at -162 degree C. The mono-fuel LNG trucks from leading OEMs are available in the European and US markets and OEMs are also developing dual fuel LNG trucks. The increase in the use of LNG worldwide as an economically viable and environmentally friendly fuel for trucks is encouraging LNG vehicle development in India too. The report says that different configurations of the LNG stations are available which can be deployed according to requirements. Nomura says that the upcoming LNG terminals will bring natural gas supply to underserved states, while LNG infra on the major highways is needed for LNG adoption. The increase in LNG production and export capacity, along with flexible contracts will lead to increased competition among LNG suppliers, which will make natural gas prices attractive for the end-consumers in the short term. The report by NRI Consulting concludes with an outlook that CNG infrastructure development is expected to complete in a timely manner thereby giving a boost to CNG vehicle sales and a similar boost to LNG infra will lead to added benefits. The demand push resulting from countrywide infrastructure will incentivize OEMs to launch dedicated NGV platforms leading to better economies of scale and efficient products. The localisation of NGV components such as LNG cryogenic cylinders and certain CNG power train components will reduce the acquisition cost for the customer boosting their TCO savings. Also, implementation of BS-VI emission norms will increase price differential between CNG and diesel vehicles, making CNG vehicles more attractive.-+
Rajesh Kumar Srivastava appointed ONGC Director (Exploration)
Rajesh Kumar Srivastava, presently the Group General Manager, Chief E and Directorate, Oil and Natural Gas Corporation (ONGC), has been appointed as the Director (Exploration), ONGC by Public Enterprise Selection Board (PSEB). Srivastava had joined ONGC in 1984 as Geologist at KG-PG Basin, Rajahmundry. Owing to an experience of more than 34 years in upstream hydrocarbon explorations from on-land and offshore sites to developing geology and seismic data interpretation, monitoring and planning of explorations, and development activities in several basins including deep water exploration on east coast of India. Owing to his specialisation in reservoir characterisation and geo-statistical modelling, he has made important contributions in field development by promoting geological models for number of oils and gas fields of India especially the fields located in Assam Arakan Bassin, Neelam, Mumbai High North, El-Nar Field of Sudan. He is the recipient of several awards including Geologist of the year award from the Chairman of ONGC in the year 2002.
Exxon, Qatar to start construction on Texas Golden Pass LNG export plant
Exxon Mobil and Qatar Petroleum told the U.S. Federal Energy Regulatory Commission (FERC) on Thursday they would start construction of the $10 billion-plus Golden Pass liquefied natural gas (LNG) export terminal in Texas on May 13: * Exxon and Qatar Petroleum made a final investment decision to build the project in February and expect the project to enter service in 2024. * Golden Pass is designed to produce around 16 million tonnes per annum (MTPA) of LNG, equivalent to about 2.1 billion cubic feet per day (bcfd) of natural gas. * One billion cubic feet is enough gas for about 5 million U.S. homes for a day. * Qatar Petroleum owns 70 percent of the project, while Exxon owns 30 percent. * Enable Midstream Partners LP has said it expects to complete the Gulf Run pipeline to transport gas to Golden Pass in late 2022. * Golden Pass selected McDermott International Inc, Chiyoda Corp and Zachry Group to build the project. * After exporting no LNG at the start of 2016, the United States is expected to become the third biggest LNG exporter in the world in 2019 behind Australia and Qatar. * The U.S. Energy Information Administration (EIA) projected U.S. LNG exports will rise to an average of 5.3 bcfd in 2019 and 7.4 bcfd in 2020 from 3.0 bcfd in 2018. LNG exports in 2018 were worth about $3.5 billion. * Looking at just the terminals under construction, total U.S. LNG export capacity is expected to increase to 7.4 bcfd by the end of 2019 and 10 bcfd by the end of 2020, up from 5.2 bcfd now.
Exxon, Qatar to start construction on Texas Golden Pass LNG export plant
Exxon Mobil and Qatar Petroleum told the U.S. Federal Energy Regulatory Commission (FERC) on Thursday they would start construction of the $10 billion-plus Golden Pass liquefied natural gas (LNG) export terminal in Texas on May 13: * Exxon and Qatar Petroleum made a final investment decision to build the project in February and expect the project to enter service in 2024. * Golden Pass is designed to produce around 16 million tonnes per annum (MTPA) of LNG, equivalent to about 2.1 billion cubic feet per day (bcfd) of natural gas. * One billion cubic feet is enough gas for about 5 million U.S. homes for a day. * Qatar Petroleum owns 70 percent of the project, while Exxon owns 30 percent. * Enable Midstream Partners LP has said it expects to complete the Gulf Run pipeline to transport gas to Golden Pass in late 2022. * Golden Pass selected McDermott International Inc, Chiyoda Corp and Zachry Group to build the project. * After exporting no LNG at the start of 2016, the United States is expected to become the third biggest LNG exporter in the world in 2019 behind Australia and Qatar. * The U.S. Energy Information Administration (EIA) projected U.S. LNG exports will rise to an average of 5.3 bcfd in 2019 and 7.4 bcfd in 2020 from 3.0 bcfd in 2018. LNG exports in 2018 were worth about $3.5 billion. * Looking at just the terminals under construction, total U.S. LNG export capacity is expected to increase to 7.4 bcfd by the end of 2019 and 10 bcfd by the end of 2020, up from 5.2 bcfd now.
Elections boost India’s petrol use to highest-ever
March 2019 recorded the highest level of monthly petrol consumption in India, thanks to the campaigning for the ongoing general elections, improved economic activity and the reduced price differential between petrol and diesel cars that boosted consumers’ preference for petrol vehicles, according to the oil ministry. The country consumed 2,577 thousand tonnes of petrol in March, a growth of 7.2 percent over 2,404 thousand tonnes in the same month last year. However, data for the full financial year 2018-19, released recently, shows petrol consumption growth during the year dropped to 8.06 percent, a 6-year low rate of growth, according to Petroleum Planning and Planning Cell (PPAC), the statistical arm of the Ministry of Petroleum and Natural Gas (MoPNG) Petrol usage in 2018-2019 stood at 282,84 thousand Tonne, as compared to 261,74 thousand Tonne recorded in the previous financial year (2017-2018). Cumulative Petroleum Demand Overall, India’s petroleum product consumption in 2018-2019 rose 2.65 percent to 2,116,40 thousand tonnes, as compared to 2,06,166 thousand tonnes recorded in the previous fiscal. The growth of 2.65 percent was the lowest recorded in the past five years. This was mainly due to a slump in the consumption of polluting fuels including Pet Coke, Fuel Oil, and Kerosene. “Growth was pulled down by negative growth witnessed in Petcoke (-20.2 percent) and FO (-3 percent) due to regulatory restrictions, and continuing de-growth in SKO due to conscious policy of GoI. Otherwise, auto fuels continued to exhibit healthy growth rates with MS and HSD posting 8% and 3% respectively,” K Ravichandran, Senior Vice President at ICRA told ETEnergyWorld. He added that India’s petroleum products consumption is projected to grow 3-4 percent in the present financial year ending March 2020. “There will continue to be headwinds in the growth on polluting fuels such as petcoke and FO. SKO will be gradually replaced by LPG, while transportation fuels and LPG will exhibit robust growth,” Ravichandran said. DIESEL India’s diesel consumption in March 2019 rose by a marginal 1.38 percent to 7,451 thousand tonnes, as compared to 7,349 thousand tonnes recorded in the corresponding month a year ago. According to PPAC, the slight increase in diesel use in the month was attributed to increased infrastructure works across the country in anticipation of general elections and the opening of new mines in Nagaland and Jharkhand. Cumulatively, diesel consumption during the full financial year 2018-2019 increased 3 percent to 835,20 thousand tonnes, as compared to 810,73 thousand tonnes recorded in the previous fiscal. Elections boost India’s petrol use to highest-ever LPG & ATF Cumulative demand for Liquefied Petroleum Gas (LPG) in 2018-2019 increased 6.8 percent to 249,18 thousand tonnes, as compared to 233,42 thousand tonnes recorded in the previous financial year. Also, Aviation Turbine Fuel (ATF) consumption last financial year grew 9.1 percent to 8,325 thousand tonnes, aided by an over 13 percent increase in domestic passenger traffic.
Exxon, Qatar to start construction on Texas Golden Pass LNG export plant
Exxon Mobil and Qatar Petroleum told the U.S. Federal Energy Regulatory Commission (FERC) on Thursday they would start construction of the $10 billion-plus Golden Pass liquefied natural gas (LNG) export terminal in Texas on May 13: * Exxon and Qatar Petroleum made a final investment decision to build the project in February and expect the project to enter service in 2024. * Golden Pass is designed to produce around 16 million tonnes per annum (MTPA) of LNG, equivalent to about 2.1 billion cubic feet per day (bcfd) of natural gas. * One billion cubic feet is enough gas for about 5 million U.S. homes for a day. * Qatar Petroleum owns 70 percent of the project, while Exxon owns 30 percent. * Enable Midstream Partners LP has said it expects to complete the Gulf Run pipeline to transport gas to Golden Pass in late 2022. * Golden Pass selected McDermott International Inc, Chiyoda Corp and Zachry Group to build the project. * After exporting no LNG at the start of 2016, the United States is expected to become the third biggest LNG exporter in the world in 2019 behind Australia and Qatar. * The U.S. Energy Information Administration (EIA) projected U.S. LNG exports will rise to an average of 5.3 bcfd in 2019 and 7.4 bcfd in 2020 from 3.0 bcfd in 2018. LNG exports in 2018 were worth about $3.5 billion. * Looking at just the terminals under construction, total U.S. LNG export capacity is expected to increase to 7.4 bcfd by the end of 2019 and 10 bcfd by the end of 2020, up from 5.2 bcfd now.
Sinopec, CNPC skip Iran oil buys for May as sanctions waivers end: Sources
China Petrochemical Corp (Sinopec) and China National Petroleum Corp (CNPC), the country’s top state-owned refiners, are skipping Iranian oil buys for May loadings, after Washington ended sanction waivers to turn up pressure on Tehran, three sources with knowledge of the matter said. The United States has decided not to renew any exemptions for sanctions on Iran, taking a tougher line than expected on the expiry of the waivers. The waivers were granted last November to buyers of Iranian oil. China is Iran’s largest oil customer with imports at 475,000 barrels a day in the first quarter of this year, according to Chinese customs data. Sinopec and CNPC have skipped bookings for cargoes loading in May as companies were worried that taking oil from Iran could invoke U.S. sanctions and cut them out of the global financial system, said two of the sources.
Royal Dutch Shell to invest $2-bn per year in Brazil
Royal Dutch Shell has plans to invest about $2 billion per year in Brazil through 2025, CEO Ben van Beurden told newspaper Valor Economico in an exclusive interview. Its investment plans could be increased to allow the company to bid in three upcoming oil and gas auctions, Valor reported in its Thursday edition based on the interview. Royal Dutch Shell will not focus exclusively on oil projects, the report said. It is interested in exploring opportunities in natural gas, biofuels and the solar energy sector, Valor said. Refineries are not part of the strategy, Valor reported. Shell’s press office was not immediately available to comment on the report.
Libya plans to increase oil output from existing fields to 1.4 million bpd this year
Libya plans to increase oil output from existing fields to 1.4 million barrels per day (bpd) by the end of 2019 and 2.1 million bpd by 2023, state-run National Oil Corp. said on its website on Thursday. The company cited a speech by its chairman, Mustafa Sanalla at a conference Houston, in which he also cautioned that the ongoing war in the North African nation could jeopardise the expansion.