Oil demand continues to healthily outpace supply
Crude oil prices averaged about 1 percent higher on a week-over-week basis, as investors remained focused on the strength of the global oil supply and demand fundamentals ahead of winter. Prices rose the most amid signs of a fast-tightening US oil market, specifically at Cushing, and a large drop in gasoline stocks. However, rising coronavirus disease (COVID-19) cases in several countries, concerns about global economic growth, and a larger-than-expected build in US crude stocks last week limited gains. Crude prices retreated, though they remained firm after the Energy Information Association reported a larger-than-anticipated build in US crude oil stocks, which eased concerns about a tightening crude oil market and prompted investors to take profit from bullish long positions. The rise in total US crude stocks offset a drop in crude stocks at Cushing and the decline in US gasoline and distillates stocks. Prices have been trading above $80 per barrel, a level that secures significant profits for US shale producers, but there is no sign that this will lead to a significant increase in investment in the shale sector. It seems that US shale production is still being mainly sustained by the activation of drilled but uncompleted wells relative to new drilled wells. However, the longer prices remain high, the more likely it is that US crude output could start to see growth again. India’s crude oil imports in September rose 16 percent to a five-month high, government data showed, as a pick-up in economic activity and mobility led to higher fuel demand. Liquefied natural gas imports into China have remained resilient, especially from long-term contracts, with utilization rates at key coastal terminals in excess of 90 percent. Asian spot LNG prices declined marginally due to more cautious Chinese buyers, who have largely retreated from the spot market given forbiddingly high prices. The LNG market is balanced by newly reported supply disruptions, most recently from Bontang LNG, where feed gas constraints are expected to take up to one cargo a month off the market from November through mid-2022. The vaccine success and reopening of social activities have enabled the US economy, and oil consumption, to flourish faster than in other regional markets, and production, hampered most recently by Hurricane Ida, has not been able to keep up with the pace of refinery intake. Rising Indian gasoil demand, tighter supplies from China and the onset of seasonal refinery maintenance in the West, are set to keep gasoil prices well supported heading into the winter heating season. Global refinery crude requirements are expected to pick up starting in November as refineries return from major turnarounds and respond to the market’s call to replenish product stock levels, given growing product tightness. The US weather forecast is trending toward colder-than-average weather in November and would likely result in expectations for higher heating fuel demand in the upcoming days. The oil price trajectory remains bullish as natural gas prices continue firm, a potentially cold winter awaits just around the corner, and oil demand continues to healthily outpace supply.
National Gas partners with HP lubricants to offer global lubricants portfolio to customers in Oman
As the country’s automotive sector and industrial segment continue to grow, lubricant consumption in Oman is projected to rise. Considering this, National Gas, Oman’s first & largest LPG marketing company, has aligned with HP lubricants to offer its global lubricants portfolio to customers in Oman. HP Lubricants, a vital part of India’s public sector undertaking Hindustan Petroleum Corporation Ltd (HPCL), is India’s largest lubricant marketer, which markets more than 350 grades of lubricants, specialities and greases. HP Lubricants find applications in automotive, industrial, mining and construction, agriculture, defence and among others. Its fast-moving products include diesel engine oil, anti-wear hydraulic oil, automatic gear oils, transmission oils, oat coolants/corrosion inhibitors, water soluble-cutting oils; and greases, namely rock breaker, multi-application/high temperature, general-purpose greases; and a range of passenger motor oils. Sanjay Kumar, Head, Lubricants, India, said, “HPCL owns and operates two major refineries producing a wide variety of petroleum fuels and specialities. We are extremely delighted having entered the Oman market to sell our high-quality lubricants.” The visit of high-profile HPCL official delegation comprising of Sanjay Kumar, Head – Lubricants, India; Vinay Kumar Sinha, GM – International Trade; and Subhendu Mohanty, CEO, HPCL Middle East, has boosted the morale of National Gas in devising effective marketing strategies to augment the sales of HPCL lubricants in Oman. Impressed with the sales, the HPCL management which reviewed the lubricants sales has acknowledged NGC by awarding it the best performer award. Nalin Chandna, CEO, National Gas Company, Oman, said, “We launched HP lubricants in Oman market on September 6, 2020 and the customer response towards HP Lubricants has been good and we are confident that it will grow further.” He added, “The collaboration demonstrates the synergies between HPCL and National Gas. Both the managements look forward to making this association long and mutually beneficial and is aimed at increasing the customer base of lubricants in Oman and the region.” The lubricants industry serves as a bellwether of economic activity as lubricants are used in all kinds of machinery, power equipment, mining and automobiles.
India, Italy to collaborate on green hydrogen, gas sector
Rome/New Delhi India and Italy have agreed to explore development of green hydrogen, setting up renewable energy corridors, and joint projects in the natural gas sector as the two nations sought to strengthen partnership in energy transition. A joint statement issued after Prime Minister Narendra Modi held the first in-person meeting with his Italian counterpart Mario Draghi on the sidelines of the G20 Summit in Rome, said the two leaders agreed to encourage joint investments of Indian and Italian companies in energy transition-related fields. They agreed to “initiate a dialogue to support the development and deployment of green hydrogen and related technologies in India” as well as to “consider working together to support a large size green corridor project in India to capitalize on India’s target to produce and integrate 450 GW of renewable energy by 2030.” The two leaders also agreed to “encourage Italian and Indian companies to develop joint projects in natural gas sector, technological innovation for decarbonisation, smart cities and other specific domains (i.e.: electrification of urban public transport).” India set an ambitious target of building capacity to generate 450 gigawatts of electricity from renewable sources such as solar and wind and more than double the share of natural gas in its energy basket to 15 per cent by 2030 as its transitions to a low carbon emitting economy. It is also looking at scaling up hydrogen production from all sources, particularly green hydrogen as part of its energy transition pathway. The joint statement said a joint working Group established by the Memorandum of Understanding on Cooperation in the field of Energy, signed in Delhi on October 30, 2017, will be tasked to explore cooperation in areas such as smart cities; mobility, smart-grids. The group will also explore cooperation in electricity distribution and storage solutions; gas transportation and promoting natural gas as a bridge fuel; integrated waste management (waste-to-wealth); and green energies (green hydrogen; CNG & LNG; bio-methane; bio-refinery; second-generation bio-ethanol; castor oil; bio-oil –waste to fuel). The two leaders also agreed to “share useful information and experiences especially in the field of policy and regulatory framework, including possible means to facilitate the transition to cleaner and commercially viable fuels/technologies, long-term grid planning, incentivizing schemes for renewables and efficiency measures, as well as with regard to financial instruments for accelerating clean energy transition.” They acknowledged significant progress in bilateral relations since the adoption of the Action Plan for an enhanced Partnership between India and Italy (2020-2024) on November 6, 2020. They expressed their resolve to strengthen cooperation in the strategic sectors addressed by the Action Plan, including the cross-cutting issue of accelerating the clean energy transition to fight climate change, central to both the G20 Leaders Summit in Rome and the COP26 in Glasgow. They also recalled the India-EU Leaders’ Meeting held in Porto on May 8, 2021, where the European Union and India highlighted the urgency of addressing the interdependent challenges of climate change, biodiversity loss and pollution. The two leaders agreed to deepen cooperation for accelerating the deployment of renewable energy, including deployment of innovative renewable technologies such as offshore wind energy and exploiting the potential of green hydrogen, promoting energy efficiency, developing smart grids and storage technologies, modernizing the electricity market. “In addition, both sides agreed on the utmost importance of cost effective integration of a growing amount of renewable energy into their respective power systems, as a key asset for an effective clean transition that generates jobs, GDP growth, reinforces universal energy access while eradicating energy poverty,” it said. “In this perspective, the two Prime Ministers appreciated India’s resolve to deploy 450 GW of renewable energy by 2030 as well as Italy’s prompt ratification and active support to the International Solar Alliance, and agreed to launch a bilateral strategic partnership in the domain of energy transition.” Such a partnership could build on existing bilateral mechanisms, including by giving new impetus to the cooperation on renewable energy and sustainable development between the Italian Ministry of Ecological Transition and its Indian counterparts, namely Ministry of New and Renewable Energy, Ministry of Power and Ministry of Petroleum and Natural Gas, it added.