The crude market was discussed at the Argus online conference
The Argus Global Crude Challenges 2020 conference took place online on 21 April, featuring speeches by Argus analysts from Houston, Singapore, London and Moscow, as well as representatives from BP, EY and Aveva, who shared their views on the current situation in the crude market, analysed the economic situation and answered live questions from online delegates.
Argus’ event partner was Aveva, a global leader in the field of engineering and industrial software. The conference was moderated by Ekaterina Derbilova, Argus’ head of editorial in the FSU, and Victor Parno, Argus’ vice president for business development in the FSU.
An overview of the macroeconomic situation and global crude market environment was presented by Argus’ chief economist David Fyfe. He said that the crude surplus will be at least 10-12mn b/d in the second quarter of this year, despite the restrictions on crude production imposed by the new Opec+ agreement.
The topic was continued by Vladimir Drebentsov, BP’s leading economist for the FSU, who presented his forecast of the crude market rebalancing. In his opinion, the new Opec+ agreement will not balance the market in the near future but will rebalance it in subsequent years.
Tom Reed, Argus’ vice president for petroleum and oil products in China, provided an overview of the Chinese market following the Covid-19 outbreak. Excess fuel in the first quarter was more than 2mn b/d, but the demand for fuel in the country is expected to recover in the coming months, he said. According to state-owned CNPC, diesel will recover in April, gasoline in May, and jet fuel in June. “China is the only source of demand growth in the global crude market,” said Reed. “New players come here to sell out their stockpiles. However, the coronavirus pandemic risks locking in excess fuel within China.”
Jeff Kralowetz, Argus’ vice president for oil and gas condensate business development in the US, gave his view on the current situation in the US crude market. US crude production fell by more than 500,000 b/d and is likely to decline by around 2mn b/d over the peak of November 2019, he noted. At the same time, US crude exports will drop in proportion to the decline in production.
Parno spoke about Russia’s outlook in the global crude market after the Opec+ agreement, while Denis Borisov, director of EY’s Moscow oil and gas centre, presented an overview of the Russian oil industry in the new reality. Alejandro Barbajosa, Argus’ vice president for crude in the Middle East and Asia-Pacific, reported on Saudi Arabia regaining ground in the struggle for market share, while James Gooder, Argus’ vice president for crude in Europe, described changes in the European crude supply.
After the event, all participants were provided with video recordings of the speeches and presentations made.