Asia

China Aims For Market Share In African Refining Sector

23 Jun 2017   Africa, China

On 22 March 2017, Sinopec agreed a deal to buy out Chevron’s downstream businesses in South Africa and Botswana, in China’s first major investment into the downstream oil industry in Africa. Although China already has an extensive footprint in Africa, the majority of these operations have been confined to the upstream sector – in oil and gas exploration. China has been steadily expanding its upstream operations outside China since the late 1990’s, through its three main state-controlled oil companies : CNPC, Sinopec and CNOOC, in an attempt to meet the country’s growing oil demand. Over the past several decades, China’s oil demand has risen drastically, driven by continued economic growth, an expanding middle class and a growing demand for consumer goods. China is now the world’s second-largest oil consumer, but due to a steady drop in domestic production – thanks to high production costs, a deterioration in mature oilfields, […]

China, India, Japan hamper Asia oil demand growth, efforts to balance market

23 Jun 2017   Asia

As the global oil market frets about a stubborn supply glut, faltering demand growth in key Asian crude importers is further hampering efforts to restore market balance. A fuel glut in China, a hangover from demonetization in India, and an ageing, declining population in Japan are holding back crude oil demand growth in three of the world’s top four oil buyers. The three countries make up a fifth of 97 million barrels per day (bpd) in global oil consumption, and any hiccups among them will mean lower-than-expected oil demand growth in Asia, helping to undercut the OPEC-led effort to support prices. “We are indeed seeing lower demand from more than a few clients – air, marine, road, industrial … They are actually consuming less fuel than anticipated,” said Michael Corley, managing director of Mercatus […]

Xi Jinping Is Set for a Big Gamble With China’s Carbon Trading Market

23 Jun 2017   China, Climate

BEIJING — As other countries look to China to take the lead in fighting global warming after President Trump’s rejection of the Paris climate agreement , President Xi Jinping is pushing ahead with an ambitious plan to build the world’s largest market for carbon emissions permits. The start of a national carbon trading market in China by late this year has been years in the making, but is now shaping up as Mr. Xi’s big policy retort to Mr. Trump’s decision to quit the Paris accord. The Chinese government said in a greenhouse gas policy guide released on Wednesday that the 2017 start was on track. “Carbon trading on a national scale will send a signal to the world that China is serious about this,” said Wang Yi , a professor at the Chinese Academy of Sciences in Beijing who also belongs to the national legislature and advises the […]

Kazakhstan ‘hugely’ important to oil and gas industry

22 Jun 2017   Kazakhstan

The head of the oil and gas division of GE says Kazakhstan has a significant role to play in global energy industries. Photo courtesy of the North Caspian Operating Company June 21 (UPI) — Kazakhstan, with its strategic trade position and strong energy portfolio, is “hugely” important to the global energy sector, a director at GE Oil & Gas said. General Electric hosted a forum in the Kazakh capital of Astana to focus on emerging regional trends in the transportation and energy industries. Lorenzo Simonelli, the head of the company’s oil and gas division, said Kazakhstan is the ideal place for a global discussion on those industries. “Rich in resources and a key trade corridor, Kazakhstan and the broader Central Asia region are hugely important to the global oil and gas industry,” he said in a statement . Oil is Kazakhstan’s primary export commodity and the country is party […]

Looming Chinese refinery cuts to hit oil demand

22 Jun 2017   China

 Some of China’s top oil refineries are having to take the highly unusual step of cutting operations during what is typically the peak demand summer season when hot weather drives up power usage and families take to the road during school holidays. Almost 10 percent of China’s refining capacity is set to be shut down during the third quarter, signaling that demand growth from the world’s top crude importer is stuttering further. West African and European suppliers are already feeling the chill from China’s reduced demand, and a global glut has dragged spot prices for crude this week to their lowest since November, 2016. Major Chinese oil refineries, including PetroChina’s Jinzhou will set their run rates around 6,500 […]

China Issues Second Batch Of Oil Import Quotas For 2017

20 Jun 2017   China

China has allowed a second batch of crude oil import quotas for independent refiners and some state-held companies for 2017, setting full-year quotas at a total of 91.73 million tons, or 1.83 million bpd, according to a document by China’s Ministry of Commerce obtained by Reuters . In January this year, China issued the first batch of quotas for non-state refiners, which totaled 68.81 million tons , refining sources told Reuters back then. As many as 29 companies, including independent refiners—the so-called teapots—and trading firms, were granted quotas, the refining sources noted, quoting an official document by the Chinese authorities. Late last year, China’s Ministry of Commerce had said that the quota for non-state refiners would be kept at 87.6 million tons, or 1.75 million bpd this year, flat compared to 2016. Now the second batch of the 2017 import quotas is set at 22.92 million tons, and included […]

GAC Motor targeting 1M unit sales by 2020, 20% new energy vehicles; entering US market by 2019; transition to electric “may be quite long”

20 Jun 2017   China, Electric Cars

GAC Motor was one of the few automakers, and the only Chinese auto brand, to take the main stage at last week’s Michelin Movin’On 2017 global sustainable mobility summit in Montreal. During his talk, Yu Jun, president of GAC Motor, said that his rapidly growing company is targeting sales of 1 million units annually by 2020, with 20% of those being new energy vehicles. Yu said that GAC plans to introduce seven new energy vehicle models—including both electric and hybrid plug-in designs—to the market this year. GAC has already established its first North America R&D Center in Silicon Valley, and plans to to enter the US market no later than 2019. As the fastest growing Chinese automaker, GAC Motor has achieved 85% compound annual growth rate for six consecutive years. In the first five months of 2017, GAC Motor has already blown past previous records with 207,000 cars sold, […]

Tesla Said Close to Agreeing on Plan for China Production

20 Jun 2017   China, Electric Cars

Local plant would allow automaker to bypass 25% import tariff Tesla’s China revenue tripled to more than $1 billion in 2016 Tesla Inc. is close to an agreement to produce vehicles in China for the first time, giving the electric-car maker better access to the world’s largest auto market, according to people familiar with the matter. The agreement with the city of Shanghai would allow Tesla to build facilities in its Lingang development zone and could come as soon as this week, said the people, who asked not to be identified because the negotiations are private. Details are being finalized and the timing of the announcement could change. Tesla would need to set up a joint venture with at least one local partner under existing rules and it isn’t immediately clear who that would be. Representatives for Tesla at the company’s headquarters in Palo Alto, California, didn’t immediately respond […]

South Korea Is Powering Down Its Nuclear-Energy Industry

19 Jun 2017   Nuclear, South Korea

SEOUL—South Korea, one of the world’s largest producers of nuclear electricity, is shifting away from the industry. President Moon Jae-in said Monday the country would scrap plans to build additional nuclear-power plants and wouldn’t seek to extend the life of existing ones. Mr. Moon made the comments in a speech at a ceremony marking the…

Iraq Dethrones Saudi Arabia As India’s No.1 Oil Supplier

16 Jun 2017   India, Iraq

Iraq has been India’s largest supplier of crude oil for the last three months, shipping data from Bloomberg has revealed . This means that OPEC’s number-two has dethroned the cartel’s leader—Saudi Arabia—which has been the top supplier in the world’s fastest-growing market in terms of oil consumption. Iraq produced almost a quarter of the oil India imported last month, or 23 percent, exporting at a daily rate of 1 million barrels. That is compared to a monthly average export market share of 19 percent for the prior four months. Saudi Arabia, on the other hand, supplied 17 percent of the crude India bought in May. Iraq has consistently shown signs of an expansion strategy for its oil industry, despite its participation in the OPEC agreement for oil output reduction. While Iraq has not been fully compliant to the production caps, Saudi Arabia has been over-compliant—a fact that contributed to […]

Is China Inflating Its EV Sales?

16 Jun 2017   China

While China is being applauded as the world’s leading market for battery electric and plug-in hybrid vehicle sales, automakers are becoming frustrated over how to actually carry out a profitable long-term strategy for that market. A new draft proposal , posted this week on the website of the Legislative Affairs Office for China’s cabinet, mandates automakers to sell a high level of plug-in electrified vehicles (called “new energy vehicles” in China). That would equate to each automaker building credits equivalent to 8 percent of sales by 2018, 10 percent by 2019, and 12 percent by 2020. Sales figures report that more than 28 million new vehicles were sold in China last year. About 351,000 were new energy vehicles, making for only 1.25 percent of the total. Holding onto these high-level clashes with a compromise between Chinese Premier Li Keqiang and German Chancellor Angela Merkel made earlier this month. China […]

Tillerson Seeks To Turn Oil Tap Off For North Korea | OilPrice.com

15 Jun 2017   North Korea

The U.S. will focus its efforts on shutting off North Korea’s access to crude oil, Secretary of State Rex Tillerson said yesterday at a Senate Foreign Relations committee hearing. In this, Washington will seek the assistance of other countries, Tillerson said.  Imposing sanctions on countries doing business with Pyongyang is another measure that is being considered by the State Department as a means of forcing North Korea to put an end to its nuclear and missile programs. Tillerson referred to these as “secondary sanctions”, which might mean that Russia would be a target. Russian exports to North Korea in the first two months of this year shot up by 149 percent, according to Russian media reports, while China banned coal exports to its belligerent neighbor.  Tillerson noted that the U.S. is working closely with China on the North Korean problem and that Beijing had “taken steps, visible steps that we can confirm,” in addressing the situation. China’s support is essential for the resolution of the North Korean problem as it provides 90 percent of North Korean imports, from crude oil and fuels to food.

China’s Crude Oil Output Lowest Since 2011

15 Jun 2017   China

According to the statistics figures, as reported by Reuters , China’s crude output level was 3.83 million bpd in May, down by 3.7 percent year on year, to the lowest domestic production volume since the statistics office started publishing records in 2011. “ Declining output this year comes as China’s major oil fields Daqing and Shengli announced production cuts at the beginning of the year. The pace of decline in production will ease this year due to higher crude prices ,” Gao Jian, a crude oil analyst with China Sublime Information Group, told Reuters. Late last year, PetroChina said that it planned to cut capital spending at China’s largest oilfield Daqing by 20 percent in 2017. Last month, China’s refinery runs jumped by 5.4 percent on the year to 10.98 million bpd, and although they were down from a record level from March this year, throughput marked the highest […]

No change in oil production plans, Kazakh oil company says

14 Jun 2017   Kazakhstan

Crude oil production from Kazakhstan could increase by the end of the year once operations at its Kashagan oil field are optimized. Photo courtesy of North Caspian Operating Company. June 13 (UPI) — Kazakhstan, a party to an OPEC-led market balance agreement, has no plans to modify its production plans, a spokesperson for an energy company said. Kazakhstan, under the terms of an agreement coordinated by the Organization of Petroleum Exporting Countries, sidelined about 20,000 barrels per day. It’s one of a handful of Central Asian producers contributing to a deal to balance an oversupplied market with managed declines in output. During the weekend, Russia news agency Tass reported that Kazakhstan had agreed to compensate for the expected increase in production from its giant Kashagan oil field so it doesn’t violate the terms of the OPEC-led effort. A spokesperson for the North Caspian Operating Co., a consortium managing Kashagan, […]

India’s Rising Temperatures Are Deadly: Study

9 Jun 2017   India

India is now two and a half times more likely to experience a deadly heat wave than a half century ago, and all it took was an increase in the average temperature of just 0.5 degrees Celsius (less than 1 degree Fahrenheit), a new study shows. The findings are sobering considering that the world is on track for far more warming. For the last two weeks much of Asia has been gripped by a heat wave, with a record high of 53.5 degrees C (128.3 degrees F) set in the southwest Pakistani city of Turbat on May 28 — the world’s hottest-ever temperature recorded for the month of May. Temperatures in the Indian capital of New Delhi have soared beyond 44 degrees C (111 degrees F). Even if countries are able to meet the Paris Agreement goals in curbing climate-warming carbon emissions, that would still […]

Gazprom considering Japanese gas pipeline

9 Jun 2017   Japan, Russia

Japan could start getting a secure line for natural gas from Russia if the conditions are right, Russian energy company Gazprom said. Photo by Stephen Shaver/UPI June 8 (UPI) — If the economics of an agreement are constructive, Japan could eventually get its natural gas from a Russian pipeline, a Gazprom executive said. Japanese companies are playing a role in the development of liquefied natural gas projects led by Gazprom in the Yamal Peninsula in the far north and on the Pacific coast. Alexander Medvedev , the deputy chairman of the country, said that could open doors for a Japanese gas pipeline as well. “We cannot exclude on the basis of general preconditions that construction of such a pipeline will be economically feasible,” he was quoted as saying by Russia news agency Tass. “Prospects and the situation are good; all our counterparts are set for fruitful work.” In the […]

Chinese oil imports up more than 10 percent

9 Jun 2017   China

Crude oil deliveries to China on the rise and means the second-largest economy in the world is the top crude oil importer. Photo by Pepj/Shutterstock June 8 (UPI) — Customs data published Thursday from the Chinese government revealed the country is the largest importer of crude oil in the world. The General Administration of Customs reported that both imports and exports increased in China in May. Chinese exports were up 15.5 percent year-on-year, while imports into the second-largest economy in the world were up 22.1 percent, an increase from the gain of 18.6 percent in April. For the first five months of the year, data show Chinese crude oil imports were up 13.1 percent year-on-year, making China the world’s largest oil importer. The data, published Thursday by China’s official Xinhua News Agency, followed a report from Dutch commodity trader Trafigura that oil and petroleum product sales were up 25 […]

China’s Crude Demand Soars As Maintenance Season Comes To An End

9 Jun 2017   China

Thanks to a 13 percent surge in crude imports (as refiners prepare for maintenance season), China’s trade surplus hit its highest since Jan (though -4 percent YoY). Imports (+14.8 percent YoY) and Exports (+8.7 percent YoY) both beat expectations. China’s overseas shipments accelerated in May from a year earlier, as Bloomberg suggests global demand shows signs of picking up. (Click to enlarge) Exports rose 8.7 percent in May in dollar terms, the customs administration said Thursday. Imports increased 14.8 percent, leaving a trade surplus of $40.81 billion dollars. (In yuan terms, exports rose 15.5 percent and imports surged 22.1 percent, bringing the trade balance to 281.6 billion yuan.) A brighter international outlook may provide support to the world’s largest trading nation, with the World Trade Organization saying it expects trade to “expand moderately” in the second quarter. Still, after a robust start to the year, the domestic economy is […]

China’s coal imports in May rise 17% on year to 22.19 million mt

9 Jun 2017   China

China imported 22.19 million mt of coal — including lignite, thermal and metallurgical coal — in May, down 10.45% from the 24.78 million mt imported in April but up 16.61% from the 19.03 million mt in May last year, according to preliminary figures released Thursday by the General Administration of Customs. Imports over January-May rose 29.6% year on year to 111.68 million mt. “The rising total coal imports momentum [was] sustained in May, though weakened 10.5% on a month-on-month basis,” Citi analysts said in a note. “Strong year-on-year imports were thanks to continued restocking demand at mines, ports and mills and positive coking coal import arbitrages since April.” China exported 1.31 million mt of coal in May, up 84.51% year on year, the GAC data showed. Article continues below… Platts Coal Trader International is the only daily publication where you can access Platts proprietary price assessments for coal trading […]

Canada’s Oil Sands Open Up To Chinese Investment

9 Jun 2017   China, Tar Sands

Canada is inviting Chinese companies to invest in its oil sands, Canada’s Natural Resources Minister Jim Carr said on Thursday, after an exodus in the past few months saw international oil majors selling a total of US$23 billion worth of assets to domestic producers. Speaking at a conference call to reporters during his trip to China, Carr said “We think there are opportunities and we laid out, along with experts from industry, what we believe to be opportunities for them,” as quoted by Reuters. “We would welcome investment from any nation that’s interested in the oil sands,” the minister noted, without giving details of what kind of Chinese investment Canada would see as welcome. The government is interested in discussing proposals case by case, he said. Chinese firms, including PetroChina, CNOOC, and Sinopec had invested in Canada’s oil sands industry between 2005 and 2012. But now, with the price […]

Seven more Fukushima residents diagnosed with thyroid cancer

7 Jun 2017   Japan, Nuclear

Seven more Fukushima Prefecture residents who were aged 18 or under at the time of the 2011 nuclear accident have been found to have thyroid cancer, the prefectural government said Monday. The number of Fukushima residents suffering from thyroid cancer now totals 152, the prefectural government said in a meeting of an expert panel. Hokuto Hoshi, head of the panel and vice chair of the prefectural medical association, called it “unlikely” that radiation was responsible for the increase. The prefectural government has conducted three sets of thyroid checkups following the March 2011 triple meltdown at Tokyo Electric Power Company Holdings Inc.’s Fukushima No. 1 nuclear power plant. The checkups also covered people who evacuated to other prefectures. The second round of checkups from 2014 confirmed five new sufferers, and a third round launched in May last year uncovered two more. The panel decided to consider improving its counting method, […]

China ‘teapot’ oil group urges compliance on quotas, tax

6 Jun 2017   China

An alliance of more than 20 of China’s independent oil refineries has urged its members to strictly adhere to government rules on oil quotas and taxes, according to a group statement seen by Reuters on Tuesday. The mostly privately run refineries, known as “teapots”, have upended China’s oil market after Beijing began allowing them to import crude in late 2015 in an effort to shake up a market dominated by state-owned majors. However, state firms like Sinopec and PetroChina have repeatedly accused the independents of undercutting their larger rivals by evading or under-paying consumption taxes for gasoline and diesel. Beijing in 2016 dispatched inspection teams to oversee the teapots’ tax records. The independents are also facing shifting government policies on oil quotas at a time when domestic oil demand […]

China will continue with climate pact even if US pulls out

1 Jun 2017   China, Climate

China said Thursday that it will work with the European Union to uphold the international agreement on climate change even if the U.S. pulls out. President Donald Trump is expected to announce his decision on whether to abandon the Paris climate accord Thursday afternoon U.S. time (3 p.m. EDT; 1900 GMT). While not mentioning the U.S. by name, Chinese Foreign Ministry spokeswoman Hua Chunying told reporters that climate change is a “global challenge” that no country can ignore. “No matter whether other countries’ positions may change, we will continue to uphold” a model of sustainable development, Hua said at a regularly scheduled news conference. China is the top emitter of man-made carbon dioxide emissions, and the United States is second. Both were key to reaching an agreement at Paris in 2015, which came into force in November and aims to keep global warming below 2 degrees […]

S Korea’s 30-day shutdown of 8 coal-fired power plants set to boost gas demand –

31 May 2017   South Korea

South Korea will shut eight ageing coal-fired power plants for a month Thursday as part of government-led efforts to tackle worsening air pollution, the country’s energy ministry said Wednesday.  It said there would be no power supply shortages in the period due to the availability of more costly but less polluting gas-fired power plants, which are mostly privately run.  “The eight coal-fired power plants aged 30 years or older will be closed June 1-30 as part of efforts to reduce air pollution,” the Ministry of Trade, Industry and Energy said in a statement. “The temporary shutdown will be held every year in spring when electricity demand is relatively low,” it added.  The eight plants are the 125 MW Yeongdong No. 1 and 200 MW Yeongdong No. 2 built in 1973 and 1979 respectively, the 200 MW Seocheon No. 1 and No. 2 built in 1983, the 560 MW Samcheonpo No. 1 and No. 2 built in 1983 and 1984 respectively and the 450 MW Boryeong No. 1 and No. 2 built in 1983 and 1984 respectively.   They are all owned by the country’s state-run electricity monopoly Korea Electric Power Corporation, or KEPCO.
The same eight plants will subsequently be closed for four months over March-June during the off-peak spring season each year from 2018, the ministry said.

India’s record diesel demand to continue in 2017, growth to slow

30 May 2017   India

India’s diesel demand is expected to rise to record levels again this year as a slew of infrastructure projects boosts use of the transport and industrial fuel, although a government-induced cash shortage will hold growth to its slowest in three years. Increased fuel efficiency, a fall in commercial vehicle sales, and the use of other fuels for power generation are also expected to dent demand growth for diesel, analysts and traders told Reuters. “The first quarter saw delayed effects of demonetization but I think (diesel demand) should improve as there are a number of projects going on such as road and railways, which should drive diesel demand up,” said Tushar Bansal, director of Ivy Global Energy, a Singapore-based consultancy. India has budgeted a record $59 […]

Not OPEC, China Dictates The Oil Prices

29 May 2017   China, Prices

The OPEC deal will lead to an ongoing tightening of the crude oil market, putting a floor beneath crude prices in the $50s per barrel in the second half of 2017, according to Helima Croft of RBC Capital Markets. She said that prices should ultimately “grind higher into the $60s” by the fourth quarter, with an average price for WTI expected at $61. Political and economic pressure surrounding Saudi Aramco’s IPO and Russian elections – both of which are slated for 2018 – will ensure that OPEC and non-OPEC does “whatever it takes” to keep oil prices stable and on the rise. But there are a lot of factors outside of OPEC’s control. High up on that list is the role of China, a country that has received little attention in the oil world as of late amid all the furor over the OPEC vs. U.S. shale debate. But […]

Is China Liberalizing Its Oil And Gas Industry At The Right Time?

29 May 2017   China

Foreign oil companies will soon be able to invest in China’s upstream sector through joint ventures with the country’s three major fossil fuel companies, according to a new manifesto by the Central Committee of the ruling Communist Party. The guidelines lay the groundwork for the liberalization of the Asian country’s energy production game, similar to the initiative spearheaded by Mexican President Enrique Nieto in 2014, which opened the nation’s fossil fuel industry to the world for the first time in nearly eight decades. Unfortunately for Mexico, just weeks after the country became open for business with foreign companies, oil prices crashed for the first time. Investment in oil exploration and extraction shrunk drastically as the industry’s biggest players published multibillion sales of owned assets. New funding for oil and gas has been hard to come by since the fall. Last year, global investment in upstream activities fell 23 percent […]

Analysis: China’s gasoil exports to rebound as Beijing hands out new quotas

29 May 2017   China

China’s gasoil exports fell sharply in April from the previous month’s record high, as a cocktail of lower stocks and reduced output at home prompted refiners to keep more barrels for local use, but market participants expect outflows to rebound in May on the back of new quotas. China’s April gasoil exports fell 35.7% month on month to 1.23 million mt, easing from a record high of 1.91 million mt in March, according to General Administration of Customs data released Wednesday. “Exports have returned to a more normal level — a level we normally see when domestic output goes down,” said an analyst in Beijing. Article continues below… 33rd Annual Asia Pacific Petroleum Conference (APPEC 2017) September 25 to 27, 2017 | Raffles City Convention Centre, Singapore As the most prestigious event in the Asia Pacific oil and gas industry calendar, APPEC 2017 delivers three days of market-driven discussions […]

More oil expected from Kazakhstan

13 May 2017   Kazakhstan

Kazakhstan could add at least another quarter million barrels of oil per day to the market through new field development, a country assessment found. The U.S. Energy Information Administration updated its country profile for Kazakhstan, noting the landlocked Central Asian country last year reached major milestones with oilfield developments. In October, the giant Kashagan field resumed production following several years of delays. At its peak, Kashagan should produce at least 370,000 barrels per day. In July, a consortium managing the Tengiz reservoir “decided to proceed with expansion plans that should increase liquids production at the Tengiz project by about 260,000 bpd beginning in 2022,” the EIA’s assessment read. Kazakhstan is one of the 12 producers outside of the Organization of Petroleum Exporting Countries that agreed […]

Exclusive: IEA to review oil demand outlook after China, India signal auto policy shifts

The International Energy Agency will review its electric vehicle (EV) use and oil demand forecasts after India and China recently signaled new policies in favor of electric cars and vehicles using other alternatives to gasoline. In its current policies scenario, last updated in November 2016, the IEA expects vehicle demand for oil to rise until 2040. But after the world’s two fastest growing oil markets, China and India, indicated they are likely to take radical turns away from gasoline, the IEA says it will need to review its forecasts. “We will therefore revisit our analysis of future EV market penetration on the basis of these new announcements for the next World Energy Outlook 2017, to be released on 14 November,” an IEA spokesman told Reuters. In […]

Former OPEC Member’s Byzantine Rules Shooing Away Explorers

12 May 2017   Indonesia

Only 20% onshore rigs in Indonesia operating vs 60% in 2012 Nation may not see major oil, gas investment: Drilling group Red tape, rising costs and declining crude prices are throttling exploration in Indonesia, the former OPEC member that now produces less oil than it uses. Only 20 percent of the 287 onshore rigs operated by contractors for local and foreign explorers are at work, compared with 60 percent in 2012, according to Wargono Soenarko, chairman of the Indonesian Oil, Gas and Geothermal Drilling Contractors. Four out of six offshore rigs are operational, he said in an interview. The decline in drilling reflects uncertainty over regulation, a complicated permits system as well as high production costs that have deterred investments for new exploration, Soenarko said. It’s a challenge the government needs to tackle for success in its plan to overhaul the nation’s energy policy and lure as much as […]

China to toughen efforts in cutting excess capacity

11 May 2017   China

China will carry on phasing out sub-standard production capacity, especially in fields of steel and iron, coal-mining and coal-fired power plants, to keep up with targets set for the year. The decision was made at a State Council executive meeting, which was presided over by Premier Li Keqiang on Wednesday. Li listened to reports on the latest progress of this year’s campaign to cut excess capacities of steel, iron, coal-mining and coal-fueled power generation, as well as the findings of inspections over the drive in concrete and glass sectors. Li said reforms offer the way forward in cutting overcapacity, which is a vital part of the supply-side structural reform. “China takes the initiative to reduce production capacity based on its own national conditions. The efforts are to make the growth model and economic structure shift to new economic drivers,” he added. The government work […]

China Crude Oil Imports Ease From Record as Teapots Slow Buying

9 May 2017   China

Independent refiners bought 21% less oil month-on-month: ICIS April imports at 8.4 million b/d down 8.8% from March record China’s oil imports dropped from a record as purchases by the country’s independent refiners were seen slowing. Buying by China, which overtook the U.S. during the first quarter as the world’s biggest importer, averaged 8.4 million barrels a day in April, down 8.8 percent from a record the previous month, according to Bloomberg calculations based on data Monday from the General Administration of Customs. Net exports of oil products fell almost 49 percent from March to 1.01 million tons. Imports have accelerated this year as China’s state energy giants pump less crude after last year’s price crash forced them to cut spending on the country’s mature, high-cost fields. The import decline from a record in March was due to seasonal refining maintenance picking up and independent processors, known as teapots, […]

DOE: China alone accounted for 42% of global plug-in vehicle sales in 2016

About 756,000 plug-in electric vehicles (PEVs) were sold in the world in 2016, with 95% of those sales in China, Europe, the United States, Japan, and Canada, according to figures compiled by the US Department of Energy (DOE). China alone accounted for 42% of sales (316,800 units). China’s 2016 PEV sales grew by 53% from 2015’s 207,000 units—most of which were all-electric vehicles (EV) (244,400 units, or 77%). PHEV sales reached 72,400 units in 2016 in China. By comparison, US PHEV sales in 2016 were 72,900 units, slightly outpacing China; however, US battery-electric vehicles sales were only 86,700. All of the European countries combined had 11% PEV sales growth from 2015 to 2016 (209,300 units), with an EV share of 44% (91,300 units). The United States PEV market grew by 40% during the same time frame, with over half (54%) of sales being EV in 2016. Japan’s PEV market […]

Oil Purchases by Top Indian Refiner Show Where Market Glut Bites

8 May 2017   India

Indian Oil boosting spot purchases of low-sulfur crude: Ashok Company reducing share of purchases made via long-term deals The global oil market glut is helping India’s biggest crude processor become nimble. While Indian Oil Corp. used to buy more than 80 percent of its crude via long-term contracts, it’s cut that share down by 10-12 percent over the past three years, said Chairman B. Ashok. That’s because a flood of “light” low-sulfur crude exacerbated by the U.S. shale boom has given the state-run company more opportunities to make spot purchases over scheduled imports of heavier, higher-sulfur Middle East oil, he said. The output-cut deal between OPEC and its allies to ease a glut has done little to shrink the flow of crude with lesser sulfur content that’s easier to process into lucrative fuels such as gasoline. Most of the supply produced in U.S. shale fields, Nigeria and Libya — […]

China Crude Oil Imports Ease From Record as Teapots Slow Buying

8 May 2017   China

Independent refiners bought 21% less oil month-on-month: ICIS April imports at 8.4 million b/d down 8.8% from March record China’s oil imports dropped from a record as purchases by the country’s independent refiners were seen slowing. Buying by China, which overtook the U.S. during the first quarter as the world’s biggest importer, averaged 8.4 million barrels a day in April, down 8.8 percent from a record the previous month, according to Bloomberg calculations based on data Monday from the General Administration of Customs. Net exports of oil products fell almost 49 percent from March to 1.01 million tons. Imports have accelerated this year as China’s state energy giants pump less crude after last year’s price crash forced them to cut spending on the country’s mature, high-cost fields. The import decline from a record in March was due to seasonal refining maintenance picking up and independent processors, known as teapots, […]

Malaysia’s clogged oil shipping lanes underscore failure to reduce glut

Oil industry leaders meeting in Malaysia next week to discuss extending production cuts won’t have to look far for evidence the market remains awash in supply. Just off the coast, in the Straits of Malacca, dozens of tankers loaded with record amounts of unsold fuel show an OPEC-led agreement to cut production in the first half of 2017 has yet to tighten the market. While not on the official agenda at the bi-annual Asia Oil and Gas Conference in Kuala Lumpur from Sunday to Tuesday, the attendance of top oil executives and policy makers including Saudi Arabian energy minister Khalid Al-Falih, ensures the production cut will be a major talking point. Crude prices languishing near 2017 lows are also keeping the over-supply issue to […]

PetroVietnam says Venezuela oil project still stalled, hopes to reactivate

4 May 2017   Venezuela, Vietnam

PetroVietnam’s joint venture with Venezuela’s state-run oil company PDVSA remains stalled but the Vietnamese company hopes ongoing talks will lead to reactivation of operations, a top executive for the company told Reuters on Wednesday. Vietnam’s state-run oil company and PDVSA operate the PetroMacareo extra-heavy crude project in Venezuela’s vast Orinoco Belt. After PetroVietnam halted oil production in 2014 due to tough economic conditions, the firm considered selling its 40-percent stake, but did not. Now, PetroVietnam is trying to get operations going again. “At the moment, we have stopped… We might restart later,” said Ngo Huu Hai, CEO of PetroVietnam Exploration and Production on the sidelines of the Offshore Technology Conference (OTC) in Houston. Both companies are in talks on new conditions for the joint venture, he added, without elaborating. He did not give a timeframe for the […]

India admits it will miss coal emissions targets

3 May 2017   India

India’s ageing power stations will miss a government deadline to slash their emissions, the country’s power minister has admitted, as he reiterated the country’s longstanding position that the responsibility for tackling global pollution rests squarely with the west. Stricter standards from the country’s environment ministry, introduced two years ago, gave the country’s mostly state-owned thermal power plants until December this year to cut carbon dioxide, sulphur dioxide and nitrogen oxide emissions and reduce their water use. The new rules, which affect stations differently depending on how old they are but require cuts of up to two-thirds in particulate matter, were intended to “minimise pollution”. But Piyush Goyal, the power minister, told the Financial Times that the country’s coal power stations, three-quarters of which are owned by the government, “will take some more time” to upgrade their technology and cut emissions. “India is not a polluter. It’s America and the western world that has to first stop polluting . . . India is doing its bit far more than we are responsible” he said. “We don’t have enough domestic capacity to meet this requirement in such a short period.”

Oil Traders Idled as China Refiners Fall Foul of Smog Fight

3 May 2017   China

Private refiners denied fuel export quotas so far this year Government seen reining in processors to combat pollution: EA A little over a year ago, China’s fast-growing private fuel makers were the newly minted stars of the global oil market, importing crude from the world’s biggest producers and seeking to sell their products abroad in a threat to rivals across Asia. Now, as the government cracks down on pollution and a glut of fuel at home, some traders who the refiners lured with an ambition to establish a global footprint are finding they have nothing to do. The processors, known as teapots, have been denied export licenses by the government, meaning they’ll have to remain home to compete with state-owned refining giants. That’s a relief for the wider Asian fuel market already overwhelmed by cheap supplies of Chinese gasoline and diesel, according to BMI Research. “We had specially hired […]

OPEC output cuts whet Asia’s appetite for North Sea oil

28 Apr 2017   Asia

OPEC production cuts have created record Asian demand for European oil and made China the second biggest consumer of North Sea crude as flows from its usual Middle East suppliers dip. Rising Asian appetite for North Sea crude has largely been fueled by the falling premium charged for North Sea crude over rival Middle East oil and this demand could last beyond OPEC’s supply cuts if that favorable pricing persists. Thomson Reuters Eikon data shows China imported almost 38 million barrels of North Sea crude from the start of the year until late April, compared with about 8 million barrels by the same point in 2016. China now lies second to Britain, the biggest consumer of North Sea crude, which had bought 49.7 million barrels by late April this year. In January to April 2016, China ranked seventh. The Organization of the Petroleum Exporting Countries, Russia and other non-OPEC […]

China’s Oil Giants Buoyed by Higher Prices as Output Stagnates

28 Apr 2017   China

Crude oil production falling as focus shifts to natural gas PetroChina swings to profit, Sinopec income more than doubles Oil’s recovery is helping ease the pain of shrinking output by China’s biggest energy producers. PetroChina Co. , the country’s largest producer, reported first quarter earnings swung to a profit thanks to the surge in prices, even as total output fell 6.3 percent from a year ago. China Petroleum & Chemical Corp. , the refining giant known as Sinopec, saw net income more than double while production dropped 2.4 percent. Along with Cnooc Ltd. , China’s biggest offshore explorer, the state-run firms are struggling to halt a drop in domestic crude output that’s pushed the country’s imports to a record, overtaking the U.S. as the world’s largest buyer. And as China’s big three raise combined spending for the first time in four years, the focus is beginning to shift to […]

Why Is China Funding Unsustainable Coal Projects In Pakistan?

28 Apr 2017   China, Coal, Pakistan

On April 16th, Chinese investments in Pakistan through the much-vaunted China-Pakistan Economic Corridor (CPEC) were revised upwards, from $46 billion to a whopping $62 billion . The project, part of China’s ambitious Belt and Road initiative to invest in trade routes from Asia to Europe, has huge implications for Pakistan’s development prospects. As part of CPEC, Beijing plans to build new industrial parks, railways, and roads to link its Xinjiang region with Pakistan’s port city of Gwadar. But instead of giving cause for celebration, the colossal Chinese investments heading to Pakistan have sparked massive protests from locals and environmentalists. Why? Because of Beijing’s senseless decision to use part of the funds to build outdated coal power plants. Since Pakistan boasts more than 175 billion tonnes of coal (equal to Saudi Arabia’s oil deposits in terms of heating value), harnessing its energy reserves is crucial to ensure the country’s economic […]

North Sea Oil Floods to Asia Like Never Before on OPEC Cuts

26 Apr 2017   Asia, Norway

Grade’s premium to Dubai oil has lowest close in seven years Smaller gap makes Brent more attractive to Asian refineries North Sea oil is flooding into Asia like never before thanks to the most competitive crude prices in seven years. OPEC’s own output cuts are partly to blame. Brent, a global benchmark, closed at a premium of just 57 cents a barrel to Dubai crude on Monday, the greatest incentive to move North Sea oil east since June 2010, data from PVM Oil Associates in London show. It was at about $2.50 at the end of November, when the Organization of Petroleum Exporting Countries said it would cut output. North Sea tankers sailing to Asia soared to a record this month, hauling at least 540,000 barrels a day. Supply of heavy grades, dominating much of the output of Saudi Arabia and neighboring countries, has diminished since OPEC and allied […]

Chevron to sell Bangladesh gas fields to Chinese co

25 Apr 2017   Bangladesh

U.S. oil and gas company Chevron Corp said on Monday it has agreed to sell its three gas producing fields in Bangladesh to Chinese firm Himalaya Energy, as part of a plan to raise billions of dollars by shedding non-core properties this year. “The agreement is for the sale of Chevron’s Bangladesh companies, which hold our interests in Bangladesh,” a company spokesman told Reuters, declining to share the deal value or any timeline. The spokesman said Himalaya Energy is owned by a consortium of China ZhenHua Oil and CNIC Corp Ltd. ZhenHua is a state-owned oil company while CNIC is an investment corporation established in Hong Kong. Reuters reported in February that ZhenHua Oil had signed […]

Chevron leaving Asian geothermal assets behind

25 Apr 2017   Phillipines

U.S. supermajor Chevron Corp. said Monday it was departing from the Asian geothermal sector with the regional sale or planned sales of its subsidiaries. For an undisclosed sum, the company said it sold off its geothermal business in Bangladesh to a Chinese consortium. The conclusion of the sale of its geothermal business unit in the Philippines is expected later this year. The U.S. company said the transaction was in line with plans to dispose of non-strategic assets. Figures from the sale in Indonesia will show up in Chevron’s first-quarter results. Chevron will be among the first supermajors to report first-quarter results later this year. Fourth-quarter results revealed the company posted its first annual loss in decades as […]

Is Australia The Next Big Thing In Shale?

25 Apr 2017   Australia

As natural gas prices have seen a bit of a correction, it’s easy to forget that natural gas is actually a pretty good play right now — at least in certain parts of the world. As the chart below shows, North American natgas prices have been uninspiring recently. With rates at the Henry Hub slipping back to near $3/mcf — trading at $3.16 as I write. (Click to enlarge) North American natural gas prices have been subdued over the past year (source: Energy Information Administration) That gives little to get excited about for traders. A far cry from the end of 2014, when a surge to over $5/mcf suddenly (and briefly) brought the natgas market back to life. But natural gas markets are very different elsewhere in the world — as news this week from Australia and Argentina shows. Unlike oil, natgas prices show big regional variations. A consequence […]

Gas Prices In North Korea Shoot Up 83% As China Mulls Oil Embargo

25 Apr 2017   North Korea

Gasoline prices in North Korea’s capital Pyongyang jumped by as much as 83 percent within three days on the back of reports that China is mulling over an oil embargo for its unruly neighbor. North Korea imports almost all the oil it uses from China, so an embargo will effectively paralyze the country, even if Pyongyang turns to Russia for alternative supplies or resorts to smuggling—neither of which would provide North Korea with adequate supplies of the fuel, one analyst from the Asia Research Center at the Yanbian University said. Beijing has in recent months taken a tougher stance against Pyongyang, regional analysts note , but not because the U.S. is pushing it to do it, rather because an increasingly belligerent North Korea is a direct and potentially serious threat to China’s own national security. The change in stance is in fact a change in priorities, according to the […]

China to boost non-fossil fuel use to 20 percent by 2030: state planner

25 Apr 2017   China

China aims for non-fossil fuels to account for about 20 percent of total energy consumption by 2030, increasing to more than half of demand by 2050, its state planner said on Tuesday, as Beijing continues its years-long shift away from coal power. In a policy document, the National Development and Reform Commission said carbon dioxide (CO2) emissions will peak by 2030 and total energy demand will be capped at 6 billion tons of standard coal equivalent by 2030. (Reporting by Josephine Mason; Editing by Christian Schmollinger)

Converting Coal Would Help China’s Smog At Climate’s Expense

25 Apr 2017   China, Climate

China’s conversion of coal into natural gas could prevent tens of thousands of premature deaths each year. But there’s a catch: As the country shifts its use of vast coal reserves to send less smog-inducing chemicals into the air, the move threatens to undermine efforts to rein in greenhouse gas emissions, researchers said Tuesday. The environmental trade-off points to the difficult choices confronting leaders of the world’s second largest economy as they struggle to balance public health and financial growth with international climate change commitments. Between 20,000 and 41,000 premature deaths annually could be prevented by converting low-quality coal in the country’s western provinces into synthetic natural gas for residential use, according to the findings of researchers from the United States and China published in the Proceedings of the National Academy of Sciences. If the gas were used for industrial purposes, fewer deaths would be averted […]