Business

Argus Media: Covid-19 sets refining sector back years- IEA

With pandemic-related demand loss heavily concentrated in the transport fuel sector, the market for refined products next year will be smaller than 2015, states report.

Published

3 years ago

July 13, 2020

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Harry Riley-Gould of global energy and commodity price reporting agency Argus Media on Friday (10 July) published a summary highlighting key points in the IEA’s ‘Oil Market Report’ that reflects the post COVID-19 landscape in fuel markets:

The IEA said today that it will take years for the refining sector to fully recover from the Covid-19 pandemic.

With pandemic-related demand loss heavily concentrated in the transport fuel sector, the market for refined products next year will be smaller than 2015, while global refining capacity will have increased by 4.2mn b/d over the same period, it said in its new Oil Market Report.

This is "arguably one of the biggest challenges refiners have ever faced".

The IEA expects global utilisation rates to fall to 72% this year, the lowest in 37 years. Rates will rise to 77% in 2021, but this remains below the long-term average of around 80%.

Refineries will need to run at reduced levels in the second half of 2020 after products stocks built at 550mn bl in the first five months of the year. Still, the IEA forecast products markets will end this year with a 675,000 b/d stock build, because yields cannot be fully adjusted to a demand landscape that has been "deeply deformed" by the pandemic. Stocks of some products are likely to continue building even at lower utilisation rates, and any benefit from improving demand is likely to be offset by much tighter feedstock markets ahead, it said.

With yet more capacity scheduled to come online after 2021 and medium-term demand recovery prospects uncertain, utilisation rates will stay low for the foreseeable future unless they are offset by permanent closures, the IEA said. It said that any closures are likely to be concentrated on more complex refineries — bucking a historical trend of less sophisticated refineries shutting because heavy-feedstock discounts and light-products premiums are narrower. This is because of a slowdown in light products demand growth, and an increasing share of lighter crude in the overall supply.

These changes require a fundamental adjustment to refinery yields, it said. Balanced markets require kerosene yields to fall by three percentage points, or by a third, this year with only a small rebound in 2021. Gasoline yields need to increase in 2020 and 2021, and diesel yields must rise this year but fall in 2021. Fuel oil yields must fall overall.

The agency also adjusted its refinery forecasts from the previous report. It now sees global runs falling by 6.4mn b/d to 75.1mn b/d in 2020, and rising by 4.7mn b/d in 2021 — compared with a respective fall of 5.4mn b/d and a rise of 5.3mn b/d in its previous report. The downward revision was concentrated in OECD throughput, which it revised to 34mn b/d this year from 34.8mn b/d in its last report, and to 35.6mn b/d from 36.9mn b/d for 2021. Asia-Pacific demand for transport fuels fell less in the first half and is recovering faster than in Europe or on the American continent, the agency said, and its forecast for Asia-Pacific refining activity in the second half is more optimistic.

A full copy of the IEA’s Oil Market Report July 2020 is available here.

Photo credit and source: Argus Media
Published: 13 July, 2020

Milestone

Singapore retains titles as Best Global Seaport and Best Seaport in Asia

Port of Singapore has been named the “Best Global Seaport” for the third consecutive year and the “Best Seaport in Asia” for the 35th time at the 2023 AFLAS Awards.

Published

3 days ago

September 29, 2023

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Singapore retains titles as Best Global Seaport and Best Seaport in Asia

The Maritime and Port Authority of Singapore on Friday (29 September) said the Port of Singapore has been named the “Best Global Seaport” for the third consecutive year and the “Best Seaport in Asia” for the 35th time at the 2023 Asian Freight, Logistics and Supply Chain (AFLAS) Awards.

These accolades recognise the contributions by the Port of Singapore serving as a key node in the global supply chain, and Singapore’s leadership in driving maritime decarbonisation and transformation.

The annual AFLAS Awards is organised by freight and logistics publication, Asia Cargo News, to honour leading service providers in the supply chain community for demonstrating leadership as well as consistency in service quality, innovation, customer relationship management and reliability. Winners were determined by votes cast by readers of the publication.

Mr Chee Hong Tat, Acting Minister for Transport and Senior Minister of State for Finance, said: “Singapore is honoured to be named the Best Global Seaport and Best Seaport in Asia. These awards are the result of the shared effort and strong collaboration between the Government, industry, unions and workers. We will continue to grow our port as an efficient, sustainable, and trusted node in global supply chains.”

Mr Teo Eng Dih, Chief Executive of MPA, said: “These awards are testament to the partnership and collaboration between Maritime and Port Authority of Singapore (MPA) with industry and international partners, the research and enterprise community, as well as unions. MPA remains committed to fostering an environment that encourages enterprise, innovation, and talent development.”

“We will continue to work with our partners to enhance Singapore’s connectivity, advance digitalisation efforts, and accelerate the decarbonisation of international shipping in line with the 2023 IMO strategy on reduction of GHG emissions from ships.”

Photo credit: Maritime and Port Authority of Singapore
Published: 29 September, 2023

Employment

Melvin Lum appointed as KPI OceanConnect Global Accounts Commercial Director in Singapore

Lum will take on the position of Commercial Director from Thomas Lee who was recently promoted to Head of APAC in a management restructure within KPI OceanConnect.

Published

3 days ago

September 29, 2023

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Melvin Lum appointed as KPI OceanConnect Global Account Commercial Director in Singapore

Global marine energy solutions provider KPI OceanConnect on Thursday (28 September) announced the appointment of Melvin Lum as Commercial Director for its Global Accounts team in Singapore.

Lum will take on the position of Commercial Director from Thomas Lee who was recently promoted to Head of APAC in a management restructure within KPI OceanConnect.

The Global Accounts team is an expert unit within KPI OceanConnect, specialised in providing long-term, tailored fuel strategy solutions to a portfolio of Key Accounts on a global scale. Dedicated regional teams located in London, Houston and Singapore work seamlessly across the world and around the clock to support their clients.

Lum joined KPI OceanConnect in 2021 as Senior Key Account manager and has made a significant contribution to the development of the team and optimisation of the daily operations of the unit in Singapore. Lum has vast experience across the supply chain and previously worked with TotalEnergies, Glencore and Global Energy Group prior to joining KPI OceanConnect.

Henrik Zederkof, Head of Global Accounts at KPI OceanConnect, said: "It is always a pleasure to witness the growth of our team members, and Melvin's progression is no exception. I have full confidence in Melvin's expertise, ability to lead the unit and dedication to his team. I look forward to seeing the progress of Melvin and his team, which will undoubtedly bring significant value to our numerous partners and the wider organisation.”

"Melvin will assume a pivotal role within the Global Accounts management team, leveraging his extensive experience in supply chain management and profound insight into emerging technologies. In his new role, Melvin will further enhance our team's skill set, aligning them with our ongoing objectives of supporting our partners in their green transition and digitalisation endeavours."

Melvin Lum, Commercial Director of KPI OceanConnect Global Accounts in Singapore, said: "I am very appreciative of the support and confidence from our management team as I take on this exciting new role. I am enthusiastic to work with the team as we continue to deliver an exceptional experience to our partners and stakeholders with dedication, innovation and passion."

Photo credit: KPI OceanConnect
Published: 29 September, 2023

Biofuel

TotalEnergies Marine Fuels renews ISCC EU certification for bio bunker fuel

Firm’s operations teams in Singapore and Geneva successfully renewed its ISCC EU sustainability certification for the supply of biofuel bunkers, says Louise Tricoire, Vice President.

Published

3 days ago

September 29, 2023

Admin

TotalEnergies Marine Fuels renews ISCC EU certification for bio bunker fuel

Louise Tricoire, Vice President of TotalEnergies Marine Fuels recently said the firm’s operations teams in Singapore and Geneva successfully renewed its International Sustainability and Carbon Certification (ISCC) EU sustainability certification for the supply of biofuel bunkers.

“This means that TotalEnergies Marine Fuels can continue sourcing and supplying marine biofuels in accordance with EU renewable energy regulations ensuring the highest sustainability standards,” she said in a social media.

“It's the third year in a row that we have successfully renewed this certification, after a deep and comprehensive audit which showed zero non-conformity.”

She added marine biofuels have grown in demand among shipping companies that want to cut greenhouse gas emissions immediately.

“TotalEnergies Marine Fuels offers marine biofuels commercially in Singapore and we are starting in Europe. This certification enables us to accompany our customers in their decarbonisation journey with the best standard solutions available today.”

Photo credit: TotalEnergies Marine Fuels
Published: 29 September, 2023