Raymond James calls IMO 2020 the "Game Changer" that will push Brent over $100/bbl by Q4 2019. IMO 2020 will increase demand for oil by 1.5 to 2.0 million barrels per day in 14 months.
Update on IMO 2020: http://www.imo.org/en/MediaCentre/Press ... imit-.aspx
I have seen comments that the Trump Administration would like to delay implementation of IMO 2020. The odds of that happening are now "slim and none". Very few ships are registered in the U.S. anyway and we already require even lower sulfur amounts in fuels used within our federal waters.
IMO 2020 is a "Game Changer"
IMO 2020 is a "Game Changer"
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group
Re: IMO 2020 is a "Game Changer"
From Bloomberg
Russia is set to suffer the biggest revenue losses from rules mandating cleaner marine fuels from 2020, because the world’s top exporter of the sulfurous residual oil that powers ships doesn’t look prepared for the change.
Refineries across the world are bracing themselves for the once-in-a-generation shift intended to reduce pollution caused by ships. While plants in Europe and the U.S. Gulf Coast seem well positioned to make the change to low-sulfur output, Russian companies have done little to prepare.
“Russia’s oil segment appears to end up among the biggest losers financially,” IHS Markit Ltd.’s senior research analyst Alexander Scherbakov said. There’s “no chance for them to be 100 percent prepared” when the new rules kick in, so Russia’s sulfur-rich fuel oil will sell at a widening discount, he said.
Read more here:
https://www.oilandgas360.com/russian-oi ... l-overhaul
Russia is set to suffer the biggest revenue losses from rules mandating cleaner marine fuels from 2020, because the world’s top exporter of the sulfurous residual oil that powers ships doesn’t look prepared for the change.
Refineries across the world are bracing themselves for the once-in-a-generation shift intended to reduce pollution caused by ships. While plants in Europe and the U.S. Gulf Coast seem well positioned to make the change to low-sulfur output, Russian companies have done little to prepare.
“Russia’s oil segment appears to end up among the biggest losers financially,” IHS Markit Ltd.’s senior research analyst Alexander Scherbakov said. There’s “no chance for them to be 100 percent prepared” when the new rules kick in, so Russia’s sulfur-rich fuel oil will sell at a widening discount, he said.
Read more here:
https://www.oilandgas360.com/russian-oi ... l-overhaul
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group
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Re: IMO 2020 is a "Game Changer"
Buckeye Partners (BPL) believes that IMO 2020 will push WTI/lighter lower sulfur US grades back into stronger Contango in 2019. It’s one of management’s arguments for improvement in their domestic tank/storage business. They’re doing a strategic review, outcome to be announced shortly, which will likely lead to a dividend cut and perhaps additional share price erosion. But, BPL could be a good investment opportunity after that fallout settles...
Re: IMO 2020 is a "Game Changer"
For exposure to the impact of IMO 2020 take a hard look at Vertex Energy (VTNR). They hosted our last luncheon in Houston. I talked to the CEO and he thinks IMO 2020 will significantly increase their profit margins.
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group
Re: IMO 2020 is a "Game Changer"
"S&P Global Platts Analytics forecasts a shift of approximately 3 million b/d of marine demand from high sulfur fuel oil to lower sulfur alternatives, and a significant jump in crude prices as refiners increase runs to maximize middle distillate output to meet the new demand."
Read: http://blogs.platts.com/2018/10/29/imo- ... r-thought/
Read: http://blogs.platts.com/2018/10/29/imo- ... r-thought/
Dan Steffens
Energy Prospectus Group
Energy Prospectus Group