Oil diverted from China finds buyer from India
Distressed oil supplies are being offered to India as the spread of the coronavirus crimps fuel consumption across China, prompting requests for cargo deferrals and cancellations by Asia’s No. 1 importer. State-owned Bharat Petroleum Corp Ltd received offers for supplies of crude from the Caspian Sea and South America for March loading, said R Ramachandran, director of refineries at the company. The shipments, originally meant for Chinese refiners, were being shown at low prices, potentially yielding up to 15% more returns when processed, he said in a phone interview. Oil importers across China’s state-owned and private refining sector have struggled to take delivery of purchased crude and gas cargoes — with one buyer declaring force majeure — as quarantines and flight restrictions eroded fuel demand and cut processing throughput by at least 2 million barrels a day. The purchasing process for the crudes on offer was underway and could be finalised by the end of the week. “We see opportunity for acquiring such cargoes extending for one more month,” Ramachandran said. BPCL is also interested in cargoes that have loaded onto tankers but are still in transit, which China is now unable to absorb, he said. The Indian refiner received offers for March-loading cargoes of grades including CPC Blend. Separately, sellers were also trying to find alternative buyers for other grades from Brazil and Russia last week after Chinese demand dried up. Trading giants including Vitol SA, Royal Dutch Shell Plc and Litasco SA were asking about hiring supertankers for storage purposes as the industry tries to deal with a glut that’s emerging in Asia. Cheaper crude cargoes will be a relief for Asian processors that have been struggling with record-low margins. Asia’s complex refining margins were the lowest in data going back to 2007 in December. It stayed near that level in January before staging a recovery so far this month.
Chandigarh: Not more than 3,000 CNG autos can move in Tricity
At a time when the administration has stopped registration of petrol, diesel, CNG and LPG auto-rickshaws and is approving only e-rickshaws in a bid to check pollution and promote e-vehicles, as many as 1,000 CNG autos each from Chandigarh, Haryana and Punjab will be allowed to ply in the Tricity on a reciprocal basis. The decision was taken in a meeting on the Tricity’s transport issues held under the chairmanship of UT adviser Manoj Parida on Tuesday. On allowing CNG autos, Parida said “such green vehicles” will be encouraged. He said the three authorities will share the data of the autos for police checking. Chandigarh has requested the Haryana government to open more CNG pumps in Panchkula to reduce the number of autos at pumps in the city, Parida said. According to the current agreement, the UT and Mohali allow only 500 autos each from both sides. Only 500 autos of Chandigarh registered with the Mohali administration can ply in Mohali. Likewise, the same number of autos of Mohali registered with Chandigarh can enter the city. However, autos bearing Haryana registration number are not allowed to enter Chandigarh for commercial and business purposes. The administration had recently submitted its action plan to the central government to control pollution. The UT had said it has already launched an extensive drive against polluting vehicles and prepared a plan to widen roads and improve infrastructure to decongest roads. The ministry road transport and highways had suggested initiatives to promote electric vehicles, like waiving of toll charges and parking charges for them and issuing green registration number plates. The government has already framed a National Electric Mobility Mission Plan, aiming at promoting hybrid and electric vehicles in the country. 6,000 autorickshaws registered with STA A senior official of the State Transport Authority (STA) confirmed the UT is not registering petrol, diesel, CNG and LPG autos and only e-rickshaws. At present, there are 6,000 autos registered with the STA. The STA renews registration of autos only after fitness inspection mandatory after every two years. Every auto owner has to renew the vehicle’s permit after every five years at a cost of Rs 5,000. A sum of Rs 300 is the fitness inspection fee after every two years for the first eight years and then after every year for the next seven years. An auto can run on the roads in Chandigarh for a maximum period of 15 years. According to the administration, a maximum of 6,000 autos registered with the STA can ply on Chandigarh roads. At present, nearly 3,000 autos are eligible for running in Chandigarh as others have not renewed their fitness inspection certificates and permits. A majority of them, who did not come for renewal of fitness inspection certificates and permits, were diesel-operated autos. Other officials present in the meeting included A K Singla, secretary, transport, Chandigarh; K Shiva Prasad, principal secretary, transport, Punjab; Umashanker, additional secretary, transport, Chandigarh; Shashank Anand, SSP (traffic), UT.
Shell, Essar fire up fuel retailing space
Automotive fuel retailing, the fiefdom of state-owned oil marketing companies is now witnessing private operators including Essar and Shell expanding their footprint steadily. Automotive fuels were under administered prices with an aim to protect the customers from sudden price shocks. In June 2010, petrol prices were opened up to market prices, with state owned retailers told to revise prices once a fortnight. Subsequently, diesel prices were deregulated in October 2014 and which was followed by opening up both for daily price revisions by retailers. Between April and December, private sector companies operated 7,203 pumps, of which 630 of them were added by Essar and Shell while Reliance didn’t add any in that period. India had 67,440 fuel stations as of December 2019, an increase of nearly 4%. “Nearly 50% of our products and revenues comes from retail operations from petrol pumps. We will fiercely guard our territory and will not yield any ground to any one,” said P Jayadevan, executive director of TN & Puducherry of Indian Oil Corporation. He said that his office was processing new pump applications from nearly 2,000 applicants and he expected at least a fourth of them to start operations over the next year. “We have already issued 250 letter of intent (LoI) from new applicants across the state and work is progress,” he said. “We are leaders in that space, we will not slacken.” Be that as it may, between April and March, Essar opened 600 new stations across India. Shell operated 175 pumps as of December 2019 as against 145 in March. “Shell Retail has been consistently growing its presence in India. We are now present in over 40 cities and towns across the country. We have expanded our network in existing cities like Bengaluru, Chennai, Ahmedabad. and have also entered new cities like Hubli-Dharwad, Coimbatore, Nashik, Bhavnagar, Jamnagar to name a few,” a Shell India spokesperson said. Reliance fuel network remained stagnant at 1,400 outlets between April and December. “There has been a slowdown in new vehicle sales over the past few. But, the long term prospects are still promising. Besides, newer avenues like opening battery swapping operations for electric vehicles in existing outlets throws in an opportunity to catch the EV space too,” a marketing official at BPCL said. State owned oil marketers pay dealers a commission of Rs 3.2 per litre of petrol and Rs 2.25 a litre of diesel. The commission is fixed by the oil ministry.
U.S. natural gas output, demand to fall in 2021 after hitting records in 2020: EIA
U.S. natural gas production and demand will decline in 2021 after hitting record highs this year, the Energy Information Administration (EIA) said in its Short Term Energy Outlook (STEO) on Tuesday. EIA projected dry gas production will fall to 92.57 billion cubic feet per day (bcfd) in 2021 from a record 94.16 bcfd in 2020. The current all-time high is 92.15 bcfd in 2019. “Because of low gas prices, EIA expects gas production to decline somewhat on a monthly basis through 2020,” EIA Administrator Linda Capuano said in a statement. That would be the first annual decline in production since 2016. EIA also projected U.S. gas consumption would fall to 85.60 bcfd in 2021 from a record 86.24 bcfd in 2020 due mostly to reduced power demand as renewables produce more electricity. The current all-time is 84.91 bcfd in 2019. That would be the first annual decline in consumption since 2017. The agency forecast U.S. net gas exports would reach 7.6 bcfd in 2020 and 8.9 bcfd in 2021, up from 5.3 bcfd in 2019. The United States became a net gas exporter in 2017 for the first time in 60 years. EIA projected gas would remain the primary U.S. power plant fuel in 2020 and 2021 after supplanting coal in 2016. It projected the share of gas generation would rise to 38% in 2020 before easing to 37% in 2021, the same as in 2019. Coal’s share of generation was forecast to slide to 21% in 2020 and 2021 from 24% in 2019. Nuclear’s share of generation was expected to hold around 20% in 2020 and 2021, while renewables would rise from 20% in 2020 to 21% in 2021, making renewables the second biggest source of the nation’s power. EIA projected the power sector would burn 464.7 million short tons of coal in 2020, the lowest since 1976 before rising to 468.8 million tons in 2021 due to an expected rise in gas prices. That would be the first annual increase since 2013 and compares with 546.1 million tons in 2019, the lowest since 1979. U.S. carbon emissions have mostly declined since peaking at 6.003 billion tonnes in 2007 as the power sector burns less coal. EIA projected carbon emissions would slip from 5.160 billion tonnes in 2019 to 5.022 billion tonnes in 2020, the lowest since 1991, and 4.997 billion tonnes in 2021, also the lowest since 1991.