Developed nations' total oil stockpiles fell in August for the first time since March, according to the International Energy Agency, but analysts say a continued buildup of refined fuels remains a barrier to reversing a two-year crude glut.
The IEA reported Tuesday that overall oil and product inventories in OECD countries fell by 10 million barrels, driven by a 22 million barrel decline in crude stocks in the United States, Japan and South Korea. But an 18.7-million barrel increase in petroleum products offset the decline.
Those products included middle distillates like jet fuel and heating kerosene, fuel oil and particularly U.S. propane. At 3.092 billion barrels, total oil stockpiles in August were just below a record of 3.111 billion barrels in July.
The rise in petroleum product stockpiles reinforced fears that demand for the "feedstock" crude that's refined into petroleum products will eventually fall as the world works through the fuels backlog, potentially dragging down oil prices anew.
"I think that really is the big worry here. Even though crude stocks drew, we saw products increase, and we have such a strong overhang of products," said Matt Smith, director of commodity research at cargo-tracking firm ClipperData.
It will sit at US$54.20/bbl by the end of 2016.
While there is a rebalancing in the crude market combined with strong global aviation demand, jet fuel prices are expected to elevate over the next five years. However, an Asian fuel supply glut will keep the Singapore Benchmark trading at a discount.
According to BMI Research, Singapore will have its prices reduced with a discount to its North American and European counterparts as a massive fuel supply glut will drag on the Asian benchmark, causing a divergence in prices.
"Our view that Singapore prices will trade at a discount to its regional peers played out over Q316. We expect this trend to continue with Singapore forecast to deepen its discount to New York as supply outstrips demand in the Asia region," the research firm noted.
Based on fuel price forecasts, for the whole of 2016, jet fuel price in the city-state will tread at US$54.20/bbl. It will be up to US$4.30/bbl in 2017.
BMI Research noted that Chinese exports of Jet Fuel are the primary driver of this glut, with the increased government fuel-export quotas compounding the oversupply.
Exxon Mobil (XOM): Safe Haven For Oil Dividend Investors During The Oil Crash
Exxon Mobil (XOM) is the ultimate blue chip stock in the oil patch, but even it hasn’t been spared the carnage of what’s being called the worst oil crash in nearly 50 years.
So naturally, many conservative investors living off dividends are wondering how safe this legendary oil giant’s dividend really is.
Let’s take a look at why, and how, Exxon plans to ride out this oil storm, and not just maintain the current payout, but also continue growing it as it has for over a third of a century.
Exxon Mobil is the world’s largest publicly traded integrated oil company, meaning it profits from extracting value from every stage of oil production, refinement, and transformation into specialty petrochemicals.
During the first half of 2016 the company produced the equivalent of just over 4.1 million barrels per day of oil, 58.8% of that in the form of higher margin liquids, such as crude oil, and the remainder in the form of natural gas. To put that in perspective, if Exxon Mobil were a nation, it would be the fifth largest oil producer on earth; ahead of Canada, Iran, Kuwait, the UAE, and Venezuela.
What’s more, with 25 billion barrels of proven oil reserves, Exxon would hold the 14th largest reserves of any nation on earth; more than Mexico, and Brazil combined.
Praxair starts new plant in Peru
On October 4, 2016, Praxair (PX) announced the start-up of the new hydrogen plant at Repsol’s La Pampilla refinery near Lima, Peru. The new facility will have the capacity to process 12 million standard cubic feet per day using Steam Methane Reformer (or SMR). A new Praxair facility will be built adjacent to the hydrogen plant that will recover and purify carbon dioxide generated out of the SMR and will be used for the manufacturing of food-grade liquid carbon dioxide.
The new plant will produce gasoline, liquefied petroleum gas, jet fuel, kerosene, diesel, and asphalts and will supply it within the local market for consumption.
In other news, Praxair signed a long-term pact with Brazilian pulp producer Fibria (FBR) to supply oxygen. Fibria is expanding its Tres Lagoas facility, and the expansion is expected to be complete by 2017. However, Praxair didn’t disclose any financial details about the deal.
Praxair stock prices
Praxair shares dropped 1.6% for the week ended October 7, 2016, and closed at $118.85. Praxair traded 2.2% higher than the 100-day moving average price of $116.30, indicating an upward trend in the stock. Analysts expect PX’s 12-month target price to be at $126.40, implying a potential return of ~6.4% over the closing price of October 7, 2016. On a year-to-date basis, PX has moved up by 16.1%.
Praxair peers Air Products and Chemicals (APD) and International Flavors and Fragrances (IFF) dropped 10.2% and 3.9% for the week, respectively. Investors can indirectly hold Praxair by investing in the SPDR S&P Dividend ETF (SDY), which has invested 1.2% of its total holdings in Praxair as of October 7, 2016.
Iran is both producing and exporting jet fuel seasonally and on demand, production coordinator in the National Iranian Oil Refining & Distribution Company told Mehr News Agency.
Pointing to two types of jet fuel, namely LL100, produced in Abadan Refinery in southern Iran, and Jp4 used in passenger and jet planes in addition to trainer aircrafts and propellers, Saeid Mahjoubi reiterated that they compete with foreign brands not only in quality but also in price.
Iran has recently finalized an agreement to supply Afghanistan and the Kurdistan Regional Government in Iraq with fuel jet.
"Iran is capable of producing and exporting quality plane and helicopter fuel," Mahjoub noted, adding that refineries are doing their best to diversify their byproduct production.
Referring to the refining capacity in Iran which currently stands at 1,870,000 barrels a day, the official said, "As soon as Persian Gulf refinery becomes operational, the refining capacity will increase to 2,100,000 bpd and surpasses that of Saudis that is currently.
Jet fuel is a specialized type of fuel used to power aircraft. It is generally of a higher quality than what is used in heating or road transport.
Moreover, it often contains additives to reduce the risk of icing or explosion due to high temperature among other properties.
GE and Qantas Join Forces to Drive Efficiencies Through Data Analytics & Collaboration ( SOURCE: GE AVIATION OCT 6, 2016 )
Today, GE Aviation opened its digital collaboration center in Austin with launch customer Qantas Airways. Through the partnership, data scientists, software developers and architects from GE and Qantas will work together to distill some of the ten billion data points produced by the aviation sector annually into solutions that can achieve greater fleet intelligence and operational insights.
GE Aviation Chief Digital Officer Jim Daily officially opened the center with Qantas Head of Fuel and Environment Alan Milne. Local officials participating in the event included State Representative Paul Workman, State Representative Celia Israel andAhmed Tewfix, chairperson of Electrical and Computer Engineering, University of Texas at Austin.
"GE's collaboration center in Austin is home to software developers, data scientists and domain experts with specific backgrounds in analytics, flight-planning and engines, depending on what we're working on," says Jim Daily. "Opening the center with Qantas marks the commitment from a customer who really understands the value of using data across their operation."
The center is located at 400 W 15th Street in Austin at GE Aviation's Digital Solutions headquarters in Austin, Texas. GE Aviation occupies approximately 27,000 square feet at the facility and employs about 100 data scientists, engineers and designers. Initiatives in the pipeline could lead to a significant increase in employment in Austin for GE Aviation by the end of 2017.
"We've seen that even small gains in fuel efficiency add up to big benefits and lower emissions when you multiply them across the hundreds of aircraft in the Qantas fleet," says Alan Milne. "The work we're doing with GE is giving us more insight than we've ever had before into the way our aircraft operate, helping us find ways of flying smarter - and this is the next step in the partnership."
The digital collaboration center in Austin is GE Aviation's first in the United States. In the past year, GE opened similar centers in Dubai, Shanghai and Paris are connecting data, developers and Predix, the world's first and only cloud-based operating system built exclusively for industry. Predix is powering innovative Industrial Internet apps that turn operational data into insight for better and faster decision making.
Today, nearly 100 airlines covering more than 10,000 aircraft are GE Aviation Digital Solutions' customers for such services as flight and fuel analytics, navigation services,airline operations management and planning and recovery.
GE's Power of One Percent report estimated the global commercial airline business spends about $170 billion per year on jet fuel. If Industrial Internet technologies - like what is being developed in the digital collaboration centre - can achieve only one percent in cost reduction, this would represent nearly $2 billion per year - or about $30 billion in fuel cost savings over 15 years for the aviation sector globally.
Check out this video of GE's collaboration center in Austin. See how GE Aviation's Digital Solutions and Predix are taking aviation productivity to the next level. Clickhere for a video on how GE Aviation is positioned to lead the Digital Industrial Era. Click here for video on how GE Aviation's digital solutions impact the future of air travel.
GE is the world's Digital Industrial Company, transforming industry with software-defined machines and solutions that are connected, responsive and predictive. GE is organized around a global exchange of knowledge, the "GE Store," where each business shares and accesses the same technology, markets, structure and intellect. Each invention further fuels innovation and application across our industrial sectors. With people, services, technology and scale, GE delivers better outcomes for customers by speaking the language of industry. www.geaviation.com/digital
Recently stock market analysts have updated their consensus ratings on shares of Antofagasta (LON:ANTO).
The newest analyst ratings which are still in issue on Tuesday 4th of October state 1 analyst has a rating of “strong buy”, 2 analysts “buy”, 11 analysts “neutral”, 1 analysts “sell” and 9 analysts “strong sell”.
Antofagasta has a 50 day moving average of 516.42 and a 200 day moving average of 474.98. The stock’s market capitalization is 5.28B, it has a 52-week low of 340.60 and a 52-week high of 610.50.
The share price of the company (LON:ANTO) was up +2.19% during the last trading session, with a high of 538.50 during the day and the volume of Antofagasta shares traded was 2871934.
Antofagasta plc is a copper mining company. The Company is engaged in by-product production and has interests in transport. The Company’s segments include Los Pelambres, Centinela, Michilla, Antucoya, Zaldivar, Exploration and evaluation, Railway and other transport services, Mining, Water concession, and Corporate and other items. Its operating divisions include Mining and Transport. The mining division includes Los Pelambres, Centinela, Antucoya and Zaldivar. The transport division operates the main cargo transport system in the Antofagasta Region of Chile, moving goods and materials, such as sulfuric acid and copper cathodes to and from mines by road and rail network. The transport division provides rail and road cargo services in northern Chile. Its mining operations produce copper with by-products of gold, molybdenum and silver. Los Pelambres and Centinela produce copper concentrate containing gold and silver. The Centinela, Antucoya and Zaldivar produce copper cathodes.
BP India, the Indian arm of British oil monster BP Plc (BP), has gotten a permit from the administration to offer plane fuel in India, its nation head said on Thursday.
"India is a tremendous business sector … Clearly we are an extensive player comprehensively in the flying business, so it bodes well for us to be here," said Sashi Mukundan, provincial president and India nation head for BP.
NSE gets board nod to launch IPO via OFS, clears bonus shares
Mukundan said BP will soon begin neighborhood offers of flight turbine fuel (ATF).
He declined to expand on whether BP will offer fuel all alone or tie up with an Indian partner.BP had, in May, sold 11.5 for each penny value in its auxiliary, Castrol Limited, diminishing its stake in the oil organization from 71 for each penny to 59.5 for every penny. The stake was sold to a scope of residential and universal financial specialists.
Castrol India is recorded on the Mumbai Stock Exchange and the National Stock Exchange an assortment of financial specialists hold the other 29 for each penny of the organization.
Sway Dudley, BP Group Chief Executive said: "BP stays focused on India and we wish to keep on growing our organizations here, advancing our upstream characteristic gas advancements and our downstream open doors, including oils."
The new Aviation Turbine Fuel (ATF) prices came into effect on October 1
Aviation Turbine Fuel (ATF) or jet fuel prices have increased 3 percent to Rs 46,826 per kilolitre, which came into effect from October 1. This is the first month the jet fuel prices rose after two consecutive months of decreasing costs.
Last month, the prices fell by 3.8 percent. In a statement, Indian Oil Corporation (IOC) said the price for international carriers has been fixed at $494 for October. It was $480.31 in September after the prices fell.
ATF prices account for nearly 30-35 per cent of operating costs for airlines and directly impacts profit margins. The prices differ in different cities.
The jet fuel price rise also seems to have impacted the share price of domestic carriers. Following the news, the SpiceJet stock was trading at Rs 60.25 at around 10:25 am on Monday, up 2.99 percent from its previous close. Similarly, the InterGlobe Aviation shares were trading at Rs 934.75 apiece, up 2.04 percent from its previous close around the same time. Jet Airways shares rose 3.95 percent and were trading at Rs 495 apiece on the Bombay Stock Exchange.
The Indian Oil stock was trading at Rs 601.45 at around 10:30 am on Monday, up 3.21 percent from its previous close on the Bombay Stock Exchange.
The revised ATF prices, new and Old (per kilolitre) are:
CitiesNew Price (Oct 1)Old price (Sept 1)
DelhiRs 46, 826Rs 45, 411
KolkataRs 51, 562Rs 50, 265
MumbaiRs 45, 743Rs 44, 418
ChennaiRs 49, 474Rs 48, 108
Solaris Intl Group
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