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  • China-US Container Rates Peak After 344 Percent Surge Driven by Hormuz Crisis

    China-US Container Rates Peak After 344 Percent Surge Driven by Hormuz Crisis

    Spot container freight rates from China to the United States have reached their peak after surging more than 330 percent since late February. Benchmark data from Xeneta shows the market is leveling off as alternative logistics routes absorb disrupted Persian Gulf flows.

    East Coast spot rates climbed 335 percent to $11,523 per 40-foot container, while shipments to the West Coast rose 344 percent to $8,346. The spread between the two destinations widened to $3,177 per box, up from $772 before the conflict began.

    The Price of Moving Asian Cargo

    Pricing pressure across transpacific corridors expanded rapidly over the past eight months. Base ocean freight increases were compounded by emergency surcharges and equipment repositioning fees across East Asian export hubs.

    Carrier networks redirected vessels to avoid regional choke points, lengthening transit times for Asia-Europe and US-bound cargo. The UAE National Association of Freight and Logistics reported that the total landed cost of moving freight into the Gulf is running three to five times above baseline levels, driven by land transport fees and rerouting penalties rather than standard tariff schedules.

    Freight benchmarking platform Xeneta projected that East Coast spot prices will fall into the $6,000 to $7,000 range over the next three months. West Coast rates are expected to retreat to between $4,500 and $5,500 per 40-foot container over the same timeframe.

    Transits Plunge as Tanker Strikes Mount

    Commercial vessel traffic through the Strait of Hormuz remains severely depressed. Maritime intelligence firm Windward recorded 11 tanker and cargo crossings in the 24 hours through Tuesday, down from the pre-war norm of roughly 125 daily transits.

    Physical attacks on commercial shipping rose sharply during the first week of October. Maritime security sources reported at least 12 strikes on oil, liquefied natural gas and liquefied petroleum gas tankers between Sept. 28 and Oct. 5, while the International Maritime Organization verified nine separate incidents.

    A projectile struck the Panama-flagged tanker On Peace on Tuesday, injuring 12 crew members according to India’s Ministry of External Affairs. Two other vessels, an inbound LPG carrier and the product tanker Lipsi, sustained damage on Sunday.

    Alternative Routes and Gulf Bypass Volumes

    Energy and commodity exports have continued through overland detours and offshore transfers despite low strait passage counts. Total Hormuz clearance averaged 11.5 million barrels per day on a seven-day basis, down from the pre-war baseline of 17.1 million barrels per day according to cargo tracking group Kpler.

    Regional export volumes reached 21.7 million barrels per day, just 7 percent below historical averages. About 40 percent of those shipments bypassed the strait entirely by loading at the UAE Port of Fujairah or using ship-to-ship transfers in the Gulf of Oman.

    Brent crude traded near $101 per barrel on Wednesday, supported by strikes on Saudi airport infrastructure earlier in the week. West Texas Intermediate held between $89 and $90 per barrel, restrained by steady bypass flows and G7 emergency crude releases.

    What Shippers Face in the Fourth Quarter

    Asian exporters and retail supply chain managers face structurally higher logistics budgets heading into the year-end peak season. While the extreme spikes of early 2026 have passed, vessel capacity remains tight across major Pacific routes.

    RetailNews Asia notes that consumer goods importers in North America and Southeast Asia are bearing the brunt of the coastal rate divergence. Importers diverting cargo away from Gulf-adjacent lanes have tied up container capacity in secondary Asian feeder ports, keeping equipment turnaround times slow.

    Contract negotiations for annual 2027 shipping tenders will open against spot rates that remain roughly double their pre-disruption baselines. Shippers are watching whether Gulf bypass pipelines at Fujairah can sustain daily volumes above 20 million barrels without facing regional bottlenecks.

  • Saudi Arabia and UAE to Bolster Asia’s Oil Reserves as 2 Nations Expand Supplies

    Saudi Arabia and UAE to Bolster Asia’s Oil Reserves as 2 Nations Expand Supplies

    Saudi Arabia and the United Arab Emirates will help build emergency oil reserves across Asian markets to safeguard supplies against sudden trade disruptions, Nikkei learned this week. The 2 Gulf producers plan to expand crude shipments to regional buyers while extending priority delivery guarantees during supply emergencies.

    Asia remains heavily dependent on imported crude oil yet holds limited domestic reserves compared to Western consumer markets. The arrangement addresses persistent vulnerabilities across major Asian import terminals and shipping hubs such as Singapore, where offshore bunkering and refining operations handle heavy maritime traffic.

    Refining centers across East and Southeast Asia rely on the Middle East for the bulk of their feedstock. Most economies in the region lack deep commercial stockpiles, leaving transport fleets, industrial parks, and power grids exposed whenever supply corridors tighten. Under the planned initiative, Gulf exporters will place barrels closer to consumer markets while securing stable long-term export quotas.

    Storage arrangements of this type allow Gulf state producers to lease tank space at Asian hubs. In exchange for local storage access, host countries gain first rights to draw on stored crude if international transit routes suffer interruptions.

    Securing crude shipments for Asian markets

    For port operators, maritime refuelling networks, and industrial supply chains, strategic reserve hubs offer a buffer against price volatility. Placing crude stockpiles inside Asian waters cuts delivery times for refiners when spot market cargoes face transit delays. Shorter delivery runs stabilize output at downstream plants producing diesel, petrochemicals, and transport fuel.

    Direct storage partnerships also reduce the financial burden on regional governments that struggle to fund dedicated state-owned reserve facilities. Private terminal operators and storage terminal owners in key ports gain long-term leasing commitments backed by state oil entities.

    Operational shifts for regional logistics networks

    Gulf oil exporters have steadily adjusted their marketing focus toward Asian buyers as Western economies diversify their power and fuel mixes. State producers in Riyadh and Abu Dhabi have previously pursued equity stakes in Asian refineries and leased crude storage tanks in commercial ports to defend market share against rival exporters.

    Expanding storage footprints in Asia reinforces these ties, binding regional refiners to Middle Eastern crude grades over multi-year cycles. Host nations accept foreign-held crude inventories on their territory because physical access during a crisis outweighs the balance-of-payments cost of holding idle state reserves.

    Trade ties between Gulf suppliers and Asia

    Formal agreements between the Gulf producers and participating Asian governments will define storage volumes, terminal locations, and specific release protocols during declared emergencies. Implementation will turn on technical evaluations at regional ports, commercial lease contracts with tank farm operators, and the final volume of crude allocated for emergency drawdowns.

    Terms and storage allocations

    Formal agreements between the Gulf producers and participating Asian governments will define storage volumes, terminal locations, and specific release protocols during declared emergencies. Implementation will turn on technical evaluations at regional ports, commercial lease contracts with tank farm operators, and the final volume of crude allocated for emergency drawdowns.

  • China Crude Oil Imports Climb to 7.84 Million Barrels Daily as Stockpiles Fall

    China Crude Oil Imports Climb to 7.84 Million Barrels Daily as Stockpiles Fall

    China increased crude oil imports to 7.84 million barrels per day in September, up from 7.25 million in August as refiners slowed stock drawdowns.

    The intake marks the highest buying level in four months, reversing an aggressive inventory clearance that had sheltered domestic transport fleets from global price volatility.

    Customs figures show August imports rose 6.2 per cent month-on-month to 37.9 million tonnes. Buying remains more than 23 per cent below year-earlier volumes, when imports ran at 9.76 million barrels daily. Sourcing patterns shifted sharply this month: shipments from Iraq jumped past 1 million barrels per day from 177,000 in August, while deliveries from Saudi Arabia and Iran dropped.

    Refiners face margin squeeze under state price caps

    Commercial and state stockpiles shrank from 1.25 billion barrels in April to 1.14 billion barrels in September, according to trade intelligence firm Kpler. For five months, Chinese refiners met domestic fuel demand by burning through reserves rather than purchasing expensive seaborne cargoes, muting inflationary pressure across freight networks.

    That buffer is now wearing thin. With stockpiles down by 110 million barrels since spring, processors must step up spot purchases even as international benchmarks hover near 100 dollars a barrel. For freight operators and consumer goods distributors across mainland logistics corridors, higher landing costs for crude will filter directly into road haulage rates and plastic packaging feedstock.

    State retail pricing rules cap fuel price adjustments once international crude tops 80 dollars a barrel. When global prices trade higher, refiners absorb the difference directly on their balance sheets, squeezing operating cash flow at major petrochemical complexes.

    Higher crude prices are now eroding Chinese refining margins, as domestic product prices are regulated above US$80 per barrel.

    Electric fleets limit domestic fuel demand rebound

    Between April and August, Chinese crude purchases trailed 2025 volumes by roughly 3.2 million barrels daily. Beyond inventory drawdowns, structural consumption shifted: new-energy vehicles took more than 65 per cent of total passenger car sales over the summer, permanently removing a slice of urban petrol demand.

    Downstream transport operators in regional logistics hubs will see little relief on diesel prices despite the passenger transition. Beijing holds roughly four to six months of total oil cover across strategic and commercial sites, giving authorities room to restrict refined-product export quotas to protect domestic fuel supply.

    Supply disruptions force shifts to Iraqi crude

    The import pickup coincides with export disruptions across key trade corridors, including strikes on Saudi Arabia’s East-West pipeline and terminal damage at Russia’s Novorossiysk facility. These bottlenecks forced Chinese trading desks to secure alternate supplies quickly, driving the sudden surge in Iraqi crude fixtures.

    Refiners are now balancing fourth-quarter crude intake targets against quarterly product export quotas, with domestic processing runs expected to stay below pre-crisis highs through October.

  • Pakistan Rolls Out Fuel Subsidies for Delivery Riders as Crude Tops 100 Dollars

    Pakistan Rolls Out Fuel Subsidies for Delivery Riders as Crude Tops 100 Dollars

    Pakistan rolled out a nationwide fuel relief scheme on Wednesday offering a 100-rupee discount per litre to cushion delivery riders and small-vehicle operators against surging crude oil prices.

    International oil prices climbed past 100 dollars per barrel following maritime disruptions in the Strait of Hormuz and Bab El-Mandeb, pushing Islamabad to subsidise local transport.

    How the Fuel Relief Scheme Works

    Deputy Prime Minister Ishaq Dar led the National Steering Committee on Fuel Subsidy to finalize operational details ahead of the midnight rollout. Under the mandate, commercial fuel stations must receive reimbursement payments within 24 hours of dispensing discounted fuel to registered motorists.

    The system allocates five litres of subsidised petrol weekly to motorcyclists, while owners of passenger cars with engine capacities up to 800cc can draw ten litres every ten days. Climate Change Minister Musadik Malik noted that the 100-rupee per litre concession offsets a combined 85 rupees in state taxes, comprising an 80-rupee petroleum levy and a five-rupee carbon levy.

    Malik cited food couriers and transport operators as primary targets for the measure. A rider covering standard delivery routes gains roughly 2,000 rupees in monthly operating margin under the quota, offsetting fuel bills that surged after recent statutory price hikes.

    Last-Mile Pressure and Supply Chain Margins

    Last-mile logistics networks and quick-commerce platforms across South Asia operate on razor-thin margins where transport fuel constitutes up to 40 per cent of route expenses. While the state cap shields gig couriers from immediate distress, the five-litre weekly quota covers only a fraction of full-time commercial driving schedules. Fleets must still absorb market rates for extra distance.

    Retail suppliers face compounded pressure through secondary freight routes. Transport contractors moving packaged goods between regional hubs and urban distribution centres do not qualify for the small-vehicle subsidy, forcing freight carriers to either push transport surcharges onto FMCG distributors or trim delivery frequencies outside tier-one cities.

    Power Generation and Grid Stability

    Power costs present a parallel risk to brick-and-mortar retail and refrigerated storage networks. Energy Minister Sardar Awais Ahmad Khan Leghari reported that spot prices for imported liquefied natural gas climbed to 23.25 dollars per million British thermal units during the shipping bottlenecks.

    Domestic power generation relied on local energy sources for 72 per cent of total output during August 2026, led by hydroelectric output at 38 per cent, domestic coal at 11 per cent, nuclear at 10 per cent, and domestic gas at seven per cent. Leghari confirmed that diverting local gas into power generation prevented an extra hour of daily load shedding across commercial grids.

    The steering committee directed provincial administrations to complete district-level station verification, with daily sales volume monitoring set to begin across all four provinces from midnight on Thursday.

  • Pakistan Hires Wood Mackenzie to Study Strategic Fuel Reserves

    Pakistan Hires Wood Mackenzie to Study Strategic Fuel Reserves

    Pakistan launched a feasibility study with energy consultancy Wood Mackenzie in Islamabad on August 25 to develop the country’s first strategic petroleum reserves. The UK-based advisory firm won the mandate against three competing bids to evaluate options for crude and refined product storage across the country.

    Petroleum Minister Ali Pervaiz Malik chaired the kick-off meeting with Wood Mackenzie executives, including Vice President Christopher Darry and Senior Vice President Aamir Malik. Representatives from Attock Refinery Limited, Pakistan LNG Limited, Government Holdings (Private) Limited, the Ministry of Maritime Affairs, and the Pakistan Institute of Development Economics also joined the session.

    Scope of the storage plan

    Wood Mackenzie will assess existing industrial infrastructure, logistics networks, and potential sites for dedicated storage facilities. The assignment covers technical integrity, safety standards, regional benchmarks, and capital expenditure estimates for a phased rollout.

    Consultants will also map legal, financial, and regulatory frameworks, evaluating public-private partnership models to fund construction. The advisory team noted that shifting global energy dynamics make this the right moment for Islamabad to secure long-term physical fuel buffers.

    Supply risks and bonded terminals

    Pakistan currently holds no strategic crude reserves, leaving domestic transport networks and industrial supply chains vulnerable to tanker traffic disruptions through the Strait of Hormuz. Prime Minister Shehbaz Sharif instructed petroleum authorities in July to expedite reserve capacity alongside updates to the national oil refining policy.

    For consumer goods distributors, freight fleets, and retailers across South Asia, fuel availability dictates baseline operating margins. Unhedged supply bottlenecks in emerging markets quickly translate into freight surcharges and shelf-price inflation when international shipping lanes face sudden friction.

    The government recently approved rules allowing international fuel traders to construct bonded storage facilities at their own expense for domestic distribution and re-export. Malik directed state bodies to share operational data with Wood Mackenzie, while a newly formed steering committee will monitor study milestones ahead of final policy submissions.

  • Philippine Fuel Retailers Raise Diesel by P2.31 per Liter

    Philippine Fuel Retailers Raise Diesel by P2.31 per Liter

    Philippine fuel retailers will raise pump prices on August 25, adding P2.31 per liter to diesel and P1.08 per liter to gasoline.

    The adjustment extends a second consecutive week of increases across Metro Manila and provincial networks, following a sharp rise on August 18 when diesel jumped P3.84 and gasoline gained P2.49. Kerosene will also climb by P0.95 per liter for the week of August 25 to 31, according to Department of Energy pricing data.

    What Drives the Regional Surge

    Dubai crude climbed roughly $8.90 per barrel during trading between August 10 and 14, driving refined product benchmarks higher across Asia. International diesel prices climbed $11.40 per barrel over the same period, while international gasoline rose $6.50 per barrel.

    Shipping constraints through the Strait of Hormuz contributed to the tighter supply outlook. Tanker transits through the passage dropped from 17 vessels on August 10 to 16 on August 11, reflecting persistent friction between Iranian and US-Israeli forces.

    Transport Costs and Supply Chains

    Rising pump prices squeeze operating margins for regional delivery fleets and retail logistics networks across the archipelago. The Philippines imports almost all of its fuel requirements, making freight and retail transport immediately sensitive to movements in global oil benchmarks and foreign exchange rates.

    Current retail levels sit well above baseline figures recorded in February. Prior to the escalation in Middle East maritime disputes, common retail prices in Metro Manila stood at P55.00 per liter for diesel and P56.00 per liter for RON95 gasoline.

    Russia also maintained its export ban on diesel during the August trading cycle, limiting replacement cargoes for Asian buyers and keeping regional diesel prices firm.

    Energy authorities will monitor crude throughput and tanker traffic through the Persian Gulf during the next trading window to assess adjustments for the first week of September.

  • Asian Shares Hold Flat as Investors Await Nvidia Earnings and US Sanctions Plan

    Asian Shares Hold Flat as Investors Await Nvidia Earnings and US Sanctions Plan

    Asian stock benchmarks traded flat on August 24 as investors held back ahead of Nvidia’s earnings and impending US sanctions on Iran. Regional tech exporters stayed cautious after sharp swings last week.

    Tokyo’s Nikkei index held steady following a 4 per cent drop the previous week, while South Korean shares fell 0.8 per cent and Taiwan slipped 0.5 per cent. The broader MSCI Asia-Pacific index outside Japan declined 0.2 per cent in morning trading.

    Tech Earnings and Jackson Hole Outlook

    Consumer electronics supply chains and semiconductor manufacturers across Asia are focused on chipmaker Nvidia, which reports earnings on August 26. Analysts expect quarterly revenue to double to roughly US$92 billion, with full-year revenue guidance projected between US$103 billion and US$105 billion.

    Regional equity markets are also tracking the outlook for US monetary policy. Federal Reserve Chairman Kevin Warsh will address the Jackson Hole economic symposium on August 28, with money markets pricing a 40 per cent probability of a rate increase on September 16 and a full move by December.

    US Treasury yields have continued to pressure equity valuations across the Pacific. Yields on 30-year US debt hovered at 5.2760 per cent, close to a 19-year peak of 5.3371 per cent, despite Treasury Secretary Scott Bessent announcing plans to double government bond buybacks.

    For Asian manufacturers and retail supply chains, high borrowing costs in the US and volatile currency markets keep export financing and inventory management under pressure. When long-term yields remain near multi-decade highs, valuations across Asian tech suppliers face tighter scrutiny from international funds.

    Trade Disputes and Commodity Pressures

    Energy and shipping corridors remain volatile as Bessent prepares to outline fresh sanctions on Iran, which maintains naval control over the Strait of Hormuz. Brent crude slipped 1.0 per cent to US$93.43 a barrel after climbing 6.6 per cent last week, while US crude fell 1.1 per cent to US$86.14.

    Cross-border retail trade faces additional frictions following a breakdown in US-Canada trade negotiations. Canadian Prime Minister Mark Carney confirmed reciprocal tariffs on US imports, covering electronics, appliances, dairy, steel, agricultural equipment, and pulp and paper.

    Gold prices advanced 0.4 per cent to US$4,623 an ounce, positioning bullion for a monthly gain exceeding 14 per cent. Attention now shifts to upcoming US core inflation figures, expected to hold at 3.3 per cent for July.

  • Japan Households Brace for Further Price Hikes Amid Weak Consumer Spending

    Japan Households Brace for Further Price Hikes Amid Weak Consumer Spending

    Japanese households are expected to face increasing financial strain as companies across the nation plan to raise prices for goods and services. These hikes, set to begin this summer, are a direct response to persistently high crude oil prices and other rising operational costs. This development is likely to further dampen consumer spending and could impede economic growth.

    Inflationary Pressures Mount

    The impending price adjustments come at a challenging time for Japan’s economy. The gross domestic product (GDP) for April-June recorded a modest 0.3% quarter-on-quarter growth, translating to an annualised rate of 1.1% after price and seasonal adjustments. However, this growth was not fueled by domestic strength. Both private consumption and corporate capital investment declined during the period, highlighting a significant weakness in Japan’s internal demand. The economy’s expansion was primarily supported by external factors.

    Impact On Retail And Consumer Sectors

    The anticipated price increases are poised to directly affect the purchasing power of Japanese consumers. With households already managing existing cost pressures, new price hikes on essential goods and services will likely lead to a further tightening of budgets. This situation poses a challenge for retailers and consumer brands operating in Japan, as cautious consumers may reduce discretionary spending. Companies will need to strategize carefully to navigate this environment of rising costs and potentially constrained consumer demand.

  • Crude oil exports plunge as resource depletes

    Crude oil exports plunge as resource depletes

    Vietnam’s crude oil export is plunging, partly because of depleting resources. An industrialist says the situation can only improve after new fields come online in several years.

    Crude exports volume from January 1 to February 15 this year fell nearly 50 percent year-on-year to 354,700 tonnes, according to Vietnam Customs.

    Most of Vietnam’s oil and gas fields have been harnessed for over 20 years ago and run their course, said Hoang Ngoc Trung, deputy director of Petrovietnam Exploration Production Corporation Ltd.

    In the last five years, crude oil prices have been falling, which has affected investment in searching for new fields, he told the Tuoi Tre newspaper.

    The corporation’s output was 3.8 million tonnes last year, down marginally from 2019, and the figure is set to fall another 10 percent this year.

    However, Vietnam’s crude oil prices remain higher than the global average.

    The global average price of Brent crude oil last year was $41.8 per barrel, but Vietnam sold them for $43.7, 4.5 percent higher.

    In the first two months, Brent crude was $58.53 per barrel, compared to $59.94 percent in Vietnam.

    Trung said exploitation volume is set to recover in the next two or three years with several new fields such as Dai Hung and White Lion coming online.

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  • Oil price drops as global economic concerns grip market

    Oil price drops as global economic concerns grip market

    Oil price fell about 2 percent on Thursday as the market was weighed down by concerns that global demand growth would lag in the coming year. A rebound from late December lows seemed to stall amid worries that a trade war between the U.S. and China would continue, weighing on demand. The market also contended with the possibility that oil producers would not adhere strictly to cuts agreed to last year.

    Brent crude futures fell $1.06 a barrel, or 1.7 percent, to settle at $61.63. U.S. crude futures fell $1.37 a barrel, or 2.5 percent, to settle at $52.64.

    “The correction is stalled, mainly on concerns about demand growth,” said Gene McGillian, director of Market Research at Tradition Energy in Stamford, Connecticut. “There seems to be uncertainty about what is going to happen with the trade talks, with global economic growth and demand in the coming year,” he said.

    In particular, he said, the market is worried about whether demand is sufficient to absorb growing crude production from the U.S.

    “Supply fundamentals have increasingly been turning supportive in recent weeks, but against this the market still worries about the yet-to-be-realised – if at all – impact on demand from weaker macroeconomic fundamentals,” said Ole Hansen, head of commodity strategy at Saxo Bank.

    Though the United States published robust jobs data last week, global markets remain nervous after China reported the lowest annual economic growth in nearly 30 years in January. That focuses yet more attention on the outcome of U.S.-China talks to end the trade war between the world’s top two economies.

    The oil price also came under pressure as weekly data published by the U.S. Energy Information Administration on Wednesday showed an unwelcome increase in stocks of crude oil.

    A decline in OPEC production and a squeeze on supply from Iran and Venezuela because of U.S. sanctions have led many analysts to forecast that the market will be balanced in 2019.

    The oil price is showing a 20 percent gain so far this year.

    Price support is provided by supply cuts led by the Organization of the Petroleum Exporting Countries (OPEC) to tighten the market.

    Saudi Arabia, the world’s top oil exporter, told OPEC it had pumped 10.24 million barrels per day (bpd) in January, two OPEC sources said, a deeper cut than targeted in the supply pact. The kingdom pumped 10.643 million bpd in December.

    “We believe that financial markets may be overestimating the risks of a global recession,” said Jean-Pierre Durante, Head of Applied Research at Pictet Wealth Management.

    “Moreover, lower oil prices – prices were between 14 percent and 18 percent lower in January than their 2018 average – are likely to stimulate economic activity and oil demand, particularly in emerging markets.”

    U.S. sanctions against Venezuela’s oil industry are expected to freeze sales proceeds of Venezuelan crude exports to the United States.

     

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  • Oil prices edge lower, tightening supply outlook supports

    Oil prices edge lower, tightening supply outlook supports

    Crude oil prices edged lower on Monday after sharp gains during the previous session but were supported by expectations of shrinking supply and signs that China-US trade tensions could ease. International Brent crude oil futures on Monday were down 20 cents, or 0.32% at 0339 GMT to $62.54 a barrel, after closing up 3.14% in the previous session to their highest close since Nov 21.

    US West Texas Intermediate (WTI) futures were at $55.13 per barrel, down 13 cents, or 0.24%, from their last settlement. WTI settled 2.73% higher in the last session at its highest close since Nov 19.

    Output declines from the Organization of the Petroleum Exporting Countries (OPEC) as they make good on their pact to curb a supply overhang were compounded by falling US oil rig counts and sanctions on Venezuelan oil sales.

    “While Venezuela’s output reportedly rose last month, fresh US sanctions on the country could see 0.5 to 1% of global supply curtailed,” said Vivek Dhar, commodities analyst for Commonwealth Bank of Australia in a note on Monday.

    The sanctions will sharply limit oil transactions between Venezuela and other countries and are similar to those imposed on Iran last year, experts said after examining details posted by the Treasury Department.

    OPEC oil supply fell in January by the largest amount in two years despite sluggish production declines from Russia, according to a Reuters survey.

    However, Russian oil output in January missed the target for the output cuts, Energy Ministry data showed on Saturday. Production last month declined to 11.38 million barrels per day (bpd), but that was only down by 35,000 bpd from its October 2018 level that is the baseline for the pact.

    Russian Energy Minister Alexander Novak has said the country’s overall cuts from the October baseline would total 50,000 bpd in January. Russia has pledged to reduce oil output by 230,000 bpd from October.

    US energy firms last week cut the number of oil rigs operating to their lowest in eight months as some drillers followed through on plans to spend less on new wells this year.

    “The collapse in oil prices late last year has resulted in more cautious spending by US oil explorers,” said Dhar.

    Meanwhile, hopes for thawing China-US relations have also helped ease concerns over slowing economic growth.

    “While the US and China have yet to reach a deal, markets were buoyed by reports that they have made significant progress,” ANZ Bank said in a research note.

    US President Donald Trump last week said he would meet with Chinese President Xi Jinping, perhaps twice, in the coming weeks to try to seal a comprehensive trade deal with Beijing, but acknowledged it was not yet clear whether a deal could be reached.

  • SK Innovation net falls 21% in 2018 on oil price decline

    SK Innovation net falls 21% in 2018 on oil price decline

    SK Innovation, Korea’s largest oil refiner, said Thursday that its earnings sank 21 percent last year on lower oil prices and less demand for petrochemical goods. Net profit reached 1.69 trillion won last year, compared with a profit of 2.15 trillion won a year earlier, the company said in a regulatory filing.

    Operating income dropped 34.2 percent year-on-year to reach 2.12 trillion won, while sales spiked 18.1 percent to 54.5 trillion won over the cited period.

  • Vietnam’s largest oil refinery begins commercial operations

    Vietnam’s largest oil refinery begins commercial operations

    The Nghi Son Refinery began commercial operation Sunday, and is expected to meet about 40 percent of domestic petroleum demand in 2019.

    Speaking at its inauguration, Prime Minister Nguyen Xuan Phuc emphasized the key role of the project.

    The refinery will process 200,000 barrels of crude per day in the first phase, equivalent to 10 million tons a year, double the capacity of Dung Quat, Vietnam’s only other refinery, in the central Quang Ngai Province.

    Situated in the Nghi Son Economic Zone, 200 km south of Hanoi in the central province of Thanh Hoa, Nghi Son is expected to hit 80 percent of capacity next year.

    According to the Thanh Hoa People’s Committee, last June the refinery was already capable of 10 refined petroleum products such as liquefied petroleum gas, gasoline A92, A95, diesel oil, and kerosene.

    As of December the plant has processed around five million tons of crude.

    Nghi Son together with Dung Quat is expected to meet 80-90 percent of domestic petroleum demand, reducing Vietnam’s dependence on imports.

    The $9 billion refinery is 35.1 percent owned by Japan’s Idemitsu Kosan Co, 35.1 percent by Kuwait Petroleum, 25.1 percent by state-run PetroVietnam and 4.7 percent by Mitsui Chemicals Inc.

  • Vietnam to cut dependancy on crude oil

    Vietnam to cut dependancy on crude oil

    A prime ministerial advisory body has said the state budget is overly dependent on crude oil, an unsustainable income source. The National Financial Supervisory Commission (NFSC) recently said crude oil is not a sustainable income source, both in the short and long term.

    In the short term, crude oil revenue can be affected by global oil prices and mining output; and the state budget has been significantly impacted by such fluctuations over the years, the NFSC noted.

    In the long run, this source of income is also unsustainable as national reserves are limited, it added.

    Earlier, Deputy Prime Minister Vuong Dinh Hue had said at a meeting of the legislative National Assembly that Vietnam needs to stop relying on crude oil and focus on tourism to ensure its economic growth.

    “It is better to welcome one million tourists than trying to find one million tons of crude oil because tourism is more eco-friendly and safe for the economy,” he’d said.

    Vietnam’s September crude oil exports totaled 375,000 tons, down 21.1 percent year-on-year, according to the General Statistics Office. This brought crude oil exports in the first nine months of this year to 2.97 million tons, down 45.2 percent from a year earlier.

    From early this year to September 15, accumulated budget revenue is estimated to be at VND898.3 trillion ($39.06 billion), of which VND43.5 trillion ($1.89 billion) or about 5 percent comes from crude oil, according to the General Statistics Office.

    Vietnam’s domestic crude oil production reached its peak in 2004 with an output of more than 20 million tons, but has declined to an estimated 14.2 million tons in 2017.

    It is forecast that around 11 million tons will be produced in 2018. Crude oil exports have contributed 0.25 percent to the country’s GDP in recent years.

  • Vietnam urged to cut dependence on crude oil

    Vietnam urged to cut dependence on crude oil

    A prime ministerial advisory body has said the state budget is overly dependent on crude oil, an unsustainable income source. The National Financial Supervisory Commission (NFSC) recently said crude oil is not a sustainable income source, both in the short and long term.

    In the short term, crude oil revenue can be affected by global oil prices and mining output; and the state budget has been significantly impacted by such fluctuations over the years, the NFSC noted.

    In the long run, this source of income is also unsustainable as national reserves are limited, it added.

    Earlier, Deputy Prime Minister Vuong Dinh Hue had said at a meeting of the legislative National Assembly that Vietnam needs to stop relying on crude oil and focus on tourism to ensure its economic growth.

    “It is better to welcome one million tourists than trying to find one million tons of crude oil because tourism is more eco-friendly and safe for the economy,” he’d said.

    Vietnam’s September crude oil exports totaled 375,000 tons, down 21.1 percent year-on-year, according to the General Statistics Office. This brought crude oil exports in the first nine months of this year to 2.97 million tons, down 45.2 percent from a year earlier.

    From early this year to September 15, accumulated budget revenue is estimated to be at VND898.3 trillion ($39.06 billion), of which VND43.5 trillion ($1.89 billion) or about 5 percent comes from crude oil, according to the General Statistics Office.

    Vietnam’s domestic crude oil production reached its peak in 2004 with an output of more than 20 million tons, but has declined to an estimated 14.2 million tons in 2017.

    It is forecast that around 11 million tons will be produced in 2018. Crude oil exports have contributed 0.25 percent to the country’s GDP in recent years.

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