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AfrOil NEWSBASE’S ROUNDUP GLOBAL (NRG) AfrOil
A global perspective in uncertain times
The world’s oil and gas companies are struggling to cope with
the fallout from weaker oil and gas demand and a global supply glut
COMMENTARY
WELCOME to the inaugural edition of News- Base’s Roundup Global (NRG), in which our team of international editors provide you with a snapshot of some of key issues affecting their regional beats.
Amid the continuing fallout from the coro- navirus (COVID-19) pandemic and oil price collapse, it has never been more important to review the oil and gas industry’s big picture.
Upstream and downstream operators, both privately owned and state run, continue to make some tough calls when it comes to project ration- alisation. Their approaches to problem solving now will have a long-lasting impact on the global energy market.
Asian sectors squeezed
Asia’s oil and gas sectors have been under enor- mous pressure following this year’s crash in fuel prices and the destruction in global energy demand precipitated by the COVID-19 pandemic.
While depressed international crude oil prices continue to squeeze upstream projects, the downstream appears to be on the rebound as regional oil product demand gradually returns in line with an easing of social quarantine measures.
India’s leading upstream developer, state- run Oil and Natural Gas Corp. (ONGC), could see losses from its natural gas business climb to INR60bn ($791mn) in financial year 2020-2021,
with the company struggling to cover the high cost of production from older fields after gov- ernment-mandated gas prices hit historic lows last month.
At the other end of the sector, meanwhile, state-run Indian Oil Corp. (IOC) revealed this week that its refining output was expanding and was likely to continue doing so. After the coun- try’s largest refiner trimmed operating rates at its plant to nearly 45% of their designed capacity, runs have rebounded to 60% of capacity and are on track to reach 80% by the end of May.
China’s downstream also appears to be enjoying a slow return to normality, with crude imports rising month on month, levels of auto- motive transport rising and state and private refiners alike raising refining runs.
The country imported 40.43mn tonnes (9.88mn bpd) of oil in April, according to the General Administration of Customs (GAC). The figure was inevitably down from the 10.68mn bpd recorded in April 2019 but was higher than the 9.72mn bpd record in March. China only began easing its social restrictions last month and has been eager to ramp up economic activity in the ensuing weeks.
If you’d like to read more about the key events shaping Asia’s oil and gas sector then please click here for NewsBase’s AsianOil Monitor.
China’s traffic levels are slowly returning to normal after the central government eased its movement restrictions.
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w w w . N E W S B A S E . c o m Week 19 13•May•2020