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COVID-19 - News digest as of 09.07.2020

July 09/2020

1. Iran oil storage almost full as sanctions and pandemic weigh

MOSCOW (MRC) -- Iran has slashed crude oil production to its lowest level in four decades as storage tanks and vessels are almost completely full due to a fall in exports and refinery run cuts caused by the coronavirus pandemic, industry data showed, said Hydrocarbonprocessing. Total onshore crude stocks surged to 54 million barrels in April from 15 million barrels in January, and swelled further to 63 million barrels in June, according to FGE Energy. Market intelligence firm Kpler estimated Iranian average onshore crude storage for June to be around 66 million barrels.

2. CPChem defers decision on USGC II Petrochemical Project

MOSCOW (MRC) -- Chevron Phillips Chemical (CPChem; The Woodlands, Texas) says it will take longer than originally planned to make a final investment decision (FID) on the USGC II Petrochemicals Project, an $8-billion joint venture with Qatar Petroleum (QP; Doha, Qatar), said Chemweek. The company cites uncertainty created by the COVID-19 pandemic. Front-end engineering and design (FEED) of the project continues. "As with other capital-intensive activities, we are closely monitoring economic developments and moderating timing to preserve optionality on this project, says a statement from CPChem. In light of uncertainty created in the wake of the COVID-19 pandemic, our company intends to defer a final investment decision while it revisits market conditions and project fundamentals." The company says it has not set a new date for FID.

3. Russian naphtha exports fall in July as gasoline output rises

MOSCOW (MRC) -- Russian naphtha exports are declining in July while domestic refineries ramp up gasoline output to cover the shortfall following months of reduced production, reported S&P Global. Northwest European naphtha traders said Russian naphtha exports are much smaller than usual. "Russian exports are less than half we normally see," a trader said. Data from Kpler software showed on July 7 that about 168,551 mt of full-range naphtha including Light Virgin grades mainly used for gasoline blending as well as petrochemicals grades, could be loading in the Baltics with a European destination for July, from 629,537kt in June. The majority of the July volumes are loading at port terminals at Ust-Luga. Russian naphtha exports rose after March as refiners preferred to produce naphtha instead of gasoline, amid anticipated weak domestic demand during the lockdown introduced to combat the spread of the coronavirus, but also to benefit from improved demand from the petrochemical sector.

4. Crude oil futures in Asia mixed awaiting fresh drivers

MOSCOW (MRC) -- Crude oil futures were mixed during mid-morning trade in Asia July 6 as the market awaits for fresh drivers to kick start the week, reported S&P Global. At 10:40 am Singapore time (0200 GMT), ICE Brent September crude futures were up 14 cents/b (0.33%) from the July 3 settle at USD42.94/b, while the NYMEX August light sweet crude contract was down by 28 cents/b (0.66%) at USD40.37/b. "Crude oil prices rose last week as optimism of a V-shaped economic recovery was strengthened by positive economic data, though some gains were pared on Friday. Falling inventories in the US and stronger US job data boosted positive market sentiment," according to a July 6 note by ANZ analysts. Nonetheless, rising cases of coronavirus in the US, which led to several states re-introducing movement restrictions continued to dampen the demand outlook. In Florida, new infections rose by more than 10,000 in a day on July 5, for the third time in the last week, pushing the state's total number of infected cases past 200,000. Meanwhile, the situation remains equally dire in Texas, with more than 8,000 new cases on July 4, a new record high, according to media reports.

5. US exports of LPG to drop as COVID-19 dents oil output

MOSCOW (MRC) -- Liquefied petroleum gas (LPG) production in the US is likely to be lower in the next few years as crude oil and associated gas production are expected to be weighed down by the effects of COVID-19, based on IHS Markit forecasts, reported Chemweek. "The global LPG market growth, the trajectory of the growth, is being reset by the pandemic situation," Yanyu He, executive director at IHS Markit, said in an online presentation on Wednesday at the IHS Markit Asia NGLs and Naphtha conference. Global refinery production of LPG and natural-gas-processingrelated output over the next few years are likely to be lower than previous IHS Markit forecasts, he said.

6.Crude rises as economic optimism trumps US concerns

MOSCOW (MRC) -- Crude oil prices made ground during the European morning trading session on July 6, taking their cue from rising Asian indexes rather than from bad news about coronavirus in the US, reported S&P Global. As of 1059 GMT, ICE September Brent crude futures were up 50 cents from the close on July 3 at USD43.30/b, while the NYMEX August light sweet crude contract was up 40 cents at USD40.64/b. "Asian indices opened on a four-month high today, kicking off the week in...positive expectations over the hopes of the Chinese economic engine sustaining global growth, despite rising (coronavirus) cases in the US," Mihir Kapadia, CEO of investment management firm Sun Global Investments, said in a note July 6.
Author:Margaret Volkova
Tags:Asia, Europe, PP, PE, crude and gaz condensate, propylene, ethylene, gas processing, petrochemistry, Chevron Phillips, COVID-19, Iran, Rossiya, USA.
Category:General News
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