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E. Finley-Richardson

@ed_fin

May 27

🇨🇳 Chinese prices for steel coil and rebar rose in Shanghai today, stoking positive sentiment among market participants following a halt to price decreases across several major global finished and semi-finished steel markets this week.
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Recent stimulus measures in China, the lifting of national lockdown measures set for next week and higher demand today all raised expectations that global steel pricing could strengthen in June.

Stimulus measures announced by the central government in 2H of May are...

now likely to be implemented at a faster pace in the coming months to stabilise the economy, and cities such as Shenzhen have announced plans to provide subsidies to consumers of new energy vehicles and household appliances in order to accelerate the economic stimulus.

Read 11 tweets

E. Finley-Richardson

@ed_fin

May 27

🇨🇳 S&P Global: China's crude throughput is set to fall further in May, extending the downtrend seen in April when it fell to the lowest in two years, as prolonged pandemic-related movement restrictions prompt state refiners to slash output further.

Asia's biggest oil consumer is witnessing overall subdued crude runs as output cuts and scheduled maintenance works at state refiners, which account for majority of China's refining capacity, have overshadowed the revival in run rates at independent refiners.

The country's crude throughput slumped to 12.66 million b/d in April, according to NBS data, the lowest since touching 11.81 million b/d in March 2020 following lockdowns due to the initial COVID-19 wave. In May, utilization rates at China's four state-owned refiners fell

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E. Finley-Richardson

@ed_fin

May 27

Allied Shipbroking: “The dry bulk market continued on its firm trajectory. While we are currently enjoying these very high levels, as well as the general abundant bullish sentiment within shipping markets, things are seemingly becoming ever more fragile from the side of demand...

“and global economic fundamentals. We cannot argue easily whether this fragility will turn out to be positive or negative as an end result in terms of shipping market performance. Things have been moving ever more sour in terms of skepticism and uncertainty within global markets.

“As such we see a keen focus on all developments related to the macro market trends. Have we adequately monitored however at which phase of the market cycle we currently stand?”

Read 10 tweets

E. Finley-Richardson

@ed_fin

May 26

Russia’s Seaborne Oil Flows Changing Patterns

Russia is the world’s second-largest exporter behind Saudi Arabia. According to IEA, Russia’s total oil production was 11.3 mb/d in January 2022, of which 10 mb/d was crude oil, while US = 17.6 mb/d and Saudi Arabia = 12 mb/d.
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Russia has warned that the current situation is causing a series of side effects on supply and oil prices that seem at the moment manageable but the future is at high risk. The oil supply market could face a severe shortage if the replacement strategy is not fully scheduled.

For Russian oil production, if an embargo is agreed upon by all E.U. members, there could be a decrease to 9.6 million barrels per day, according to estimates made by the IEA. This would be the lowest since 2004 and would happen at a time when the global oil supply is tight.

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E. Finley-Richardson

@ed_fin

May 26

Small tankers and ship-to-ship transfers are now used to get Russian oil to China. Russian ESPO crude is usually shipped directly to China. Now, buyers are loading crude on small tankers and shipping it to S. Korean waters, where it's loaded onto supertankers then taken to China.

Almost all of Russian ESPO for sale is now going to China. The ship-to-ship transfer tactic was and probably is still being used by Iran to ship its oil abroad (i.e. also to China) to avoid U.S. sanctions. The sanctions against Russia only target the shipping industry, currently.

This is where available small tankers come in, as do China-owned supertankers [such as VLCC's] sitting idle because of the decline in imported oil demand amid Covid lockdowns. [Now we know why so many Chinese are buying 20 year old VLCC's!].

Read 5 tweets

E. Finley-Richardson

@ed_fin

May 26

Clean tankers are hurrying across the Atlantic with gasoline from EU to the US where stocks are at multi-year lows at the start of driving season. The US is feeling the strains of a depleted refining system and inventories at 8y lows, prompting freight rates to rise.
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$STNG

Platts assessed gasoline RBOB New York Barges at a $144.85/mt premium to Eurobob FOB AR barges May 21. The premium has been above $100/mt since April 13, enticing product away from Europe.

Freight rates for clean tankers on the route have been rising. Platts assessed Clean UK-Continent-US Atlantic Coast, basis 37,000 mt, at $45.59/mt on May 21, up from $27.90/mt on April 20. “Product tanker demand remains strong. (...)

Read 9 tweets

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