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Last Updated: January 18, 2018
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Market Watch

Headline crude prices for the week beginning 15 January 2017 – Brent: US$69/b; WTI: US$63/b

  • After a strong week, oil prices reversed course as concerns that a correction is imminently due, after a major crude-buying spree by hedge funds last week.
  • There are also fears that the strength in oil prices could cause OPEC to revise its supply freeze plan far earlier than expected, but several OPEC oil ministers have urged the group to ‘stay the course.’
  • Supply disruptions in Libya and unrest in Iran have largely died down, removing output concerns over crude price equations.
  • With WTI prices above US$60/b, more interest in shale has emerged, but the industry warms that it is facing a tight labour and supply chain market. Indications are that shale players have also not been adding significantly more drills, instead electing to ‘do more with less’.
  • Larger-than-expected drops in the US crude inventory levels have also supported strong crude prices, but the EIA is also reporting significant gains in gasoline and fuel stocks.
  • The EIA maintains that US crude production will rise over 2018, hitting 11 mmb/d by 2019. The target for Q118 is 10.4 mmb/d.
  • However, there are warning signs in Asia, where Singaporean refining margins slumped to under US$6/b last week, down 90% from the 2017 high. With huge supply coming out of China as well, the Asian fuels glut could see a major correction this year, impacting crude demand.
  • Active US oil and gas rig sites jumped by 15 last week, with onshore shale gains leading the way. Canadian rigs jumped by a massive 102 sites, a 10-month high as drillers returned en masse from the Christmas/New Year break.
  • Crude price outlook: Oil prices should ease back from recent highs as correction sets in, but still maintain around US$67-68 for Brent and US$61-62/b for WTI.

Headlines of the week


  • After President Donald Trump moved to open up almost all US offshore waters to oil/gas drilling, at least 12 American states are applying for exclusion from the plan, after Florida was granted an exemption.
  • Premier Oil has announced plans to triple production at the North Sea Cather field to 60,000 b/d within the first half of 2018.
  • With repairs on the Forties Pipeline System completed successfully, the affected Bruce, Keith and Rhum fields have all resumed production.
  • The first Norwegian drilling licence of 2018 has been handed out, as Norway stands caught between expanding its upstream industry and its environmental lobby. Lundin Norway AS received the permit for well 16/4-11 in the central part of the North Sea, the fifth well in the area.
  • ExxonMobil’s streak in Guyana continues, as it announced a ‘home run’ offshore finding in the Stabroek Block (also claimed by Venezuela), which is its sixth major finding since drilling began in 2015.


  • India’s oil consumption grew by the slowest pace in four years, with oil product demand growing by only 2.3%, hit by a tax increase and the government’s demonetisation drive. Gasoline demand was up 7.4%, as was gasoil, but both were capped by rising retail prices. Naptha, jet fuel and kerosene were all sharply down, with only LPG as a bright spot.
  • State group Sinoche and private chemical giant Hengli Group have signed an agreement to cooperated on crude/fuel trading and marketing, with Hengli expecting to start its 400 kb/d Dalian refinery this year.
  • Fairfax Africa Fund and multiple (undisclosed) Asian partners are planning a US$4 billion, 120 kb/d oil refinery in Ethiopia in Awash.
  • The Curacao drama continues. After been rejected by the state government for its high levels of debt, China’s Guangdong Zhenrong Energy has tapped the private Baota Petrochemical Group to assist in its plan to operate the aging Isla refinery in the Caribbean.

Natural Gas/LNG

  • The USA has officially become a net exporter of natural gas for the first time since 1957, as the EIA data showed net exports averaging at 400 mmcf/d in 2017, boosted by piped gas to Mexico and LNG shipments.
  • Australia’s LNG exports in 2017 hit a record high of 56.8 mtpa, boosted by the startup of major projects and strong demand from Japan and China.
  • Beach Energy has struck gas at Haselgrove-3 ST1, in the onshore Otway Basin in South Australia. Initial flow indications are at some 25 mcf/d.  
  • Indonesia will be opening a tender this year for three natural gas pipelines connecting the Natuna fields to Borneo, landing in West Kalimantan and continuing onshore to South Kalimantan. The tender is worth an estimated US$1.1 billion, and could break up the current gas pipeline duopoly held by Pertamina and PGN.


Just after recently after selling its US oil trading business to Vitol, the Noble Group is shutting down its London oil trading desk and winding down its Asian trading operations as its battles heavy losses and debt.

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Forecasting Bangladesh Tyre Market | Zulker Naeen

Tyre market in Bangladesh is forecasted to grow at over 9% until 2020 on the back of growth in automobile sales, advancements in public infrastructure, and development-seeking government policies.

The government has emphasized on the road infrastructure of the country, which has been instrumental in driving vehicle sales in the country.

The tyre market reached Tk 4,750 crore last year, up from about Tk 4,000 crore in 2017, according to market insiders.

The commercial vehicle tyre segment dominates this industry with around 80% of the market share. At least 1.5 lakh pieces of tyres in the segment were sold in 2018.

In the commercial vehicle tyre segment, the MRF's market share is 30%. Apollo controls 5% of the segment, Birla 10%, CEAT 3%, and Hankook 1%. The rest 51% is controlled by non-branded Chinese tyres.

However, Bangladesh mostly lacks in tyre manufacturing setups, which leads to tyre imports from other countries as the only feasible option to meet the demand. The company largely imports tyre from China, India, Indonesia, Thailand and Japan.

Automobile and tyre sales in Bangladesh are expected to grow with the rising in purchasing power of people as well as growing investments and joint ventures of foreign market players. The country might become the exporting destination for global tyre manufacturers.

Several global tyre giants have also expressed interest in making significant investments by setting up their manufacturing units in the country.

This reflects an opportunity for local companies to set up an indigenous manufacturing base in Bangladesh and also enables foreign players to set up their localized production facilities to capture a significant market.

It can be said that, the rise in automobile sales, improvement in public infrastructure, and growth in purchasing power to drive the tyre market over the next five years.

January, 18 2019
Your Weekly Update: 14 - 18 January 2019

Market Watch

Headline crude prices for the week beginning 14 January 2019 – Brent: US$61/b; WTI: US$51/b

  • After a rally, crude oil prices took a breather at the start of this week, as the market moved from a bullish mood to a cautious one as slowing Chinese trade data spooked the market
  • The US government shutdown – now the longest ever in history – continues with no end in sight, with Republicans and President Donald Trump at a stalemate with energised Democrats
  • That ended a week-long rally that allowed crude oil to bounce back from sub-US$50/b levels in December over OPEC+’s implementation of a new deal to shrink supplies and Saudi Arabia’s promise to ‘do more if needed’
  • Even Russia, which showed some reluctance in implementing a speedy cut, has made strides in reducing output, releasing data that showed that production fell by 30,000 b/d in December and is on track for a decrease of 50,000 b/d in January relative to October levels
  • However, the OPEC+ group is now reportedly struggling to set a date for their next meeting, where the supply deal will be reviewed; the review is set for April, ahead of OPEC’s usual Vienna meeting in June/July, but an April review is necessary to assess the expiration of American waivers on Iranian crude
  • Some downside to price trends is that the waivers on Iranian crude exports have nullified the impact of American sanctions; both Turkey and India have recently resumed imports of Iranian crude after a brief hiatus, with India electing to pay for all its crude in rupees
  • Although WTI prices have improved, American drillers are still reticent to add sites, wary of changing market conditions; Baker Hughes indicates that the active American drill count was flat last week, with the loss of 4 oil rigs offset by a gain of 4 gas ones
  • Crude price outlook: Upward momentum should continue with crude price this week, but at a more gradual pace, as fears of a slowing global economy weigh on the market. Brent should stay in the US$61-63/b range and WTI in the US$52-54/b range

Headlines of the week


  • BP is proceeding with a major US$1.3 billion expansion of the Atlantis Phase 3 in the Gulf of Mexico, aimed at adding 38,000 b/d of additional output
  • Venezuela has announced plans to remap its Caribbean oil and gas prospects, a move that potentially puts it on collision course with ExxonMobil over the country’s long-disputed borders with the now oil-rich Guyana
  • New seismic studies at BP have identified a billion more barrels of oil in place at the deepwater Thunder Horse platform in the Gulf of Mexico
  • Saudi Arabia has published an updated figure of its oil reserves – its first in 40 years – pegging total volumes at 268.5 billion barrels
  • Norway has cut its crude production forecast, predicting the output will be 1.42 mmb/d in 2019, the lowest level since 1988
  • BP is reportedly looking to sell its 28% stake in the North Sea Shearwater assets to offset its recent US$10.6 billion acquisition of US shale fields
  • The Unity fields in South Sudan have resumed production, after being halted for five years over a civil war, with initial production targeted at 20,000 b/d
  • Eni and Thailand’s PTTEP have secured exploration rights to an oil and gas concession in Abu Dhabi, with Adnoc participating at 60% if oil is struck
  • TransCanada Corp – ahead of name change to TC Energy – is planning to start construction on the controversial Keystone XL oil pipeline in June, even in the face of continued social and legal setbacks
  • Spirit Energy’s Oda field in the Norwegian North Sea has received permission from the Norwegian Petroleum Directorate to start up
  • Aker Energy has completed successful appraisal of the offshore Pecan field in Ghana, estimating some 450-550 mmboe of resources in place
  • Shell and BP have submitted plans to begin exploratory drilling in Brazil’s Pau Brasil and Saturno pre-salt areas in early 2020


  • Saudi Arabia has reiterated plans to build a US$10 billion oil refinery in Pakistan’s deepwater port of Gwadar, part of the larger China-Pakistan Economic Corridor plan that is part of the Belt and Road initiative
  • Shell Chemicals has started up its fourth alpha olefins unit at in Geismar, Louisiana, adding 425,000 tpa of capacity to a new total of 1.3 mtpa
  • After being idled over the paralysis between PDVSA and ConocoPhillips, the 335,000 b/d Isla refinery in Curacao has restarted, with operations likely to shift from PDVSA to Saudi Aramco’s Motiva US refining subsidiary

Natural Gas/LNG

  • After seemingly receiving official go-ahead from all levels of government and even indigenous groups, Shell’s US$31 billion Kitimat LNG project in Canada has now been blockaded by a group of protesting First Nation holdouts
  • Completion of major LNG projects in Australia’s west coast have allowed its LNG exports to increase by 23% in 2018, with greater growth expected in 2019
  • The NordStream 2, long championed by German Chancellor Angela Merkel, now faces new opposition in Germany over Russian global political interference – which could result in the controversial pipeline being delayed or cancelled
  • Shell has completed its acquisition of a 26% stake in the Hazira LNG and port venture in India from Total, bringing its equity interest to full ownership
  • BP has announced plans to drill six new exploration wells in Azerbaijan by 2020, hoping to strike a new natural gas play to rival its giant Shah Deniz field
January, 18 2019
Latest issue of GEO ExPro magazine covers geoscience and oil and gas activity focusing on Frontier Exploration and the Gulf of Mexico

GEO ExPro Vol. 15, No. 6 was published on 10th December 2018 bringing light to the latest science and technology activity in the global geoscience community within the oil, gas and energy sector.

This issue focusses on frontier exploration, downhole acquisition tools and how we can collaboratively increase the efficiency of the exploration and production of oil, gas and energy resources. With a geographical focus on the Gulf of Mexico, this issue provides a lesson on the carbonate geology of the Florida Keys and details coverage of newly improved tectonic restorations of the US and Mexican conjugate margins which have enabled enhanced mega-regional hydrocarbon play and reservoir fairway maps of the region.

You can download the PDF of GEO ExPro magazine for FREE and sign up to GEO ExPro’s weekly updates and online exclusives to receive the latest articles direct to your inbox.

To access the latest issue, please visit:

January, 17 2019