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Russian ESPO Blend oil shipping rates are at their lowest level since January, traders report
Three traders reported that the freight rates for ESPO blend crude shipped from Russia's port of Kozmino into China in April fell to their lowest level since mid-January due to increased availability of tankers. The lower rates will mean that Russian exporters spend less money on freight and get more oil for their money. The freight rates for the route are now around $2-3 million per cargo for April loadings, down from $4-5 million in February and March. This is because more non-sanctioned tanks have entered the ESPO marketplace. Calculations based on data from three trading sources revealed that the price of Russia's ESPO blend oil fell below $60 per barrel for the first ever time in early April, as Brent crude benchmark dropped to its lowest levels in many years. Traders said that the price of oil has fluctuated since then but is still around $60 per barrel. "ESPO blend hovers around 60 (per barrel). The combination of higher oil prices and lower shipping rates could push the price of ESPO Blend back over the cap, complicating the search for a vessel. After U.S. sanctions on vessels involved with Russian oil shipments were placed on January 10 as many vessels working in Kozmino Port were targeted, the cost of transporting ESPO blend to China jumped from $6 million to $7 million. The U.S. sanctions against Russia's oil sector targeted the major oil companies Surgutneftegaz, and Gazprom Nepta as well as over 180 vessels. Shipping oil from Kozmino, Russia to northern Chinese ports used to be less than $1.5M. The traders said that if there are no new restrictions on Russian oil transport, those levels could be reached again this year. Reporting by journalists in Moscow and Aizhu chen in Singapore, with editing by Jan Harvey
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South Korea's FLC purchases about 60,000 metric tonnes of feed wheat, traders claim
The Feed Leaders Committee of South Korea (FLC) purchased around 60,000 tons of animal feed grain from anywhere in the world, without holding an international tender. The wheat was bought at a price of $253.99 per ton, c&f. Plus a surcharge of $1.50 per ton for port unloading. The seller was thought to be ADM, a trading house. The arrival of wheat in South Korea around October 10 was the target. If the Black Sea region is as traders suspect, then shipment will be between August 5 and 9. The reports reflect the opinions of traders, and it is still possible to estimate prices and volume later. South Korean importers purchased corn and feed wheat in a number of deals on Wednesday. Traders said that low prices generated interest among buyers. FLC bought corn as part of a private deal Wednesday. Michael Hogan reports.
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JSW Infra, India's JSW Infra, posts 54% increase in quarterly profit due to higher coal volume
India's JSW Infrastructure announced a 54% increase in its fourth-quarter profits on Wednesday. This was boosted by a volume increase in coal, one of their key cargoes. The company's net profit, which was 3.30 billion rupees in January-March, grew to 5.09 billion rupees (60,2 million dollars) from last year. Private port operators such as JSW Infra, and its larger rival Adani Ports, have enjoyed steady cargo movements across Indian borders until U.S. president Trump's erratic policy on tariffs threatened to disrupt the trade and add additional risks to a slowing economic. Analysts at Jefferies, however, said that JSW is relatively protected from global trade risks due to its higher exposure to bulk commodities like iron ore, coal and other domestically-oriented cargo. The cargo volume increased by 5% on the year, while revenue rose 17% to 12,83 billion rupees. The company stated that the increase in volume was due to the robust performance of the coal terminals at Mangalore Ennore and Paradip...partially off-set by lower cargo volumes at Paradip's Iron Ore Terminal. The cargo volume increase was below the growth of 9% that occurred in the same time period last year. It was, however, unchanged from the prior quarter and in line with the 5% estimate by brokerage Elara Securities. Shares of the company closed 2.3% lower than before earnings. Adani Ports will report its results on Thursday. $1 = 84.5050 Indian Rupees (Reporting and editing by Eileen Soreng in Bengaluru)
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Grid says solar is not responsible for the blackout in Spain, but Sanchez was pressed by Sanchez to explain it.
On Wednesday, Spain's grid operator denied that solar power was the cause of Spain's worst blackout in history. Prime Minister Pedro Sanchez is under increasing pressure to explain why it happened. After a blackout which halted trains and airports, and trapped Spanish in lifts, life has returned to normal. Sanchez's critics blamed low investment for a system heavily reliant on intermittent solar power and wind. Sanchez announced an investigation by the government and stated that he wanted answers from private companies who feed electricity into the grid. He said that he had not ruled out the possibility of a cyber-attack, although private companies and REE, a part-state owned grid operator, have dismissed this. REE (headed by former Socialist Minister Beatriz Corredor) has pinpointed the cause of the outage as two separate incidents at substations located in southwest Spain. However, it's still too early to determine what caused the events. Corredor, in an interview with Cadena SER radio on Wednesday, said that it was incorrect to blame the outage of Spain's high renewable energy share. She said, "These technologies are stable and have systems which allow them to function as conventional generation systems without any safety concerns." She added that she was not contemplating resigning. In an interview with a different reporter, she stated that the government had given a deadline for power companies to submit data by Wednesday afternoon which would help explain why things went wrong. MALFUNCTIONING REE Political opponents claimed that Sanchez took too long to explain a blackout and that he was trying to cover up the failures of REE. In an interview with RTVE, Miguel Tellado said that since REE had ruled out a cyberattack and the company has a state investment, its leaders were appointed by the government. Sanchez's announcement of a government investigation was rejected by Sanchez, who called for a separate independent investigation to take place. The Spanish government has said that it asked for the "maximum transparency and collaboration" from private energy companies to identify the cause of this outage. Ignacio Sanchez Galan said that REE should explain the cause of the blackout. Antonio Turiel, a Spanish National Research Council (CSIC) energy expert, told Onda Vasca Radio on Tuesday that grid instability was the main problem. He said that "a lot of renewable energy was integrated without the responsive stabilisation system that should have existed", adding that vulnerabilities were caused by "the unplanned, haphazard integration" of a variety of renewable systems. Through 2030, the government anticipates that private and public investments of 52 billion euro will be made to upgrade the electricity grid in order to handle the demand surge from data centres and electrical vehicles. Aelec, a utility lobby, says that's not enough. (Reporting and writing by David Latona in Madrid, Pietro Lombardi)
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Equinor anticipates a tight European summer gas supply
The need to replenish Europe's storages that were two-thirds empty following the winter will keep the market tight, and demand an increase in the supply of liquefied gas, according to Anders Opedal, CEO of Equinor. Equinor is the continent's biggest gas supplier. The European gas storage sites have ended winter heating at their lowest levels since 2022. This is due to the colder weather, lower wind speeds and increased demand for gas. Opedal stated that Europe will need 200-300 additional LNG cargoes than last year. He said that gas storages in Europe are low and that a tighter market is expected when they are replenished. The company's earnings for the first quarter were boosted by higher gas costs. Equinor ships LNG out of its own LNG plant in Hammerfest, Arctic Norway (also known as Melkoeya). This shutdown is scheduled to continue until July 19, 2019. Equinor will surpass Russia's Gazprom in 2022 as Europe's largest natural gas supplier after the Russian invasion of Ukraine broke decades-old energy ties. However, speculation is growing about a possible return of Russian pipeline gas. Opedal stated that the latter is "possible, but I don't think it will happen, and volumes will be restricted". Opedal stated that Equinor estimated the additional volume potential in Russia at 40 billion cubic meters per year. This figure is still valid. He added, "But this also requires a great deal of change in the politics for the Nord Stream Pipeline to be opened up and then the Yamal pipe over Poland to be reopened again. And also the Ukraine pipeline must be reopened."
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South Korea's KFA purchased about 65,000 t corn from the U.S. privately, traders claim
European traders reported that the Korea Feed Association in South Korea purchased approximately 65,000 metric tonnes of animal feed corn from the United States on Wednesday in a private transaction without issuing a tender. The KFA Incheon section is believed to have purchased the feed from Mitsui for an estimated $248.69 per ton, cost and freight included. Incheon is also known as the Feed Buyers' Group. Arrival of corn in South Korea is expected to be around August 5. If the corn is sourced from U.S. Pacific Northwest Coast, as some traders suspect it to be, then shipment will take place between June 21 and 21. The reports reflect the opinions of traders, and it is still possible to estimate prices and volume later. After the Chicago corn futures fell, Asian buyers continued to buy corn in large quantities. The Korean importer NOFI bought an estimated 132,000 tonnes in an international auction on Wednesday and Korea's Feed Leaders Committee reported a private sale of approximately 66,000 tons. Michael Hogan is reporting.
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Refining Margin for 380-cst HSF O reaches more than 6-year High
The refining profit margin for high-sulfur fuel oil (HSFO), 380-cst, reached its highest level in over six years Wednesday. This was boosted by the lower crude oil price and seasonal strength of the market. Singapore's 380-cst HSFO/Brent cracked closed at a premium $2.15 per barrel, its highest level since November 2018, according LSEG data. The 380-cst HSFO/Dubai cracked closed at a premium price of $2.01 per barrel. On Wednesday, benchmark crude oil prices continued to fall and were on track for their biggest monthly decline in nearly three and a quarter years. Market sources reported that despite a limited recovery in spot HSFO prices during recent sessions, there has been strength on the forward curve of the derivatives markets. The HSFO markets typically improves in the second quarter as summer demand from the Middle East increases. This year's HSFO cracks are stronger, and they will become rare premiums by February. (Reporting and editing by Louise Heavens, Varun H K, and Jeslyn Lerh)
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South Korea's FLC purchases about 66,000 T of corn in a private deal, traders claim
The Feed Leaders Committee of South Korea (FLC) purchased around 66,000 tons of animal feed in a private transaction on Wednesday, without holding an international tender. The corn was bought at an estimated cost of $248.49 per ton, including freight. There was also an additional surcharge of $1.25 per ton for port unloading. The seller was thought to be ADM, a trading house. Arrival of corn in South Korea is expected around August 25. If the corn is sourced from U.S. Pacific Northwest Coast, then shipment will be between July 11 and august 10. The reports reflect the opinions of traders, and it is still possible to estimate prices and volume later. After the Chicago corn futures fell, Asian buyers continued to buy corn in large quantities. The major Korean importer NOFI purchased 132,000 tons of corn in a Wednesday international tender. Michael Hogan reports.
Indian port operator JSW Infra is looking inwards to ease tariff-hit trade woes
India's JSW Infrastructure stated on Wednesday that it expects cargo volumes to grow in fiscal year 2026 due to the resilience of domestic sectors, and minimized concerns about U.S. trade uncertainty.
In a call following earnings, Rinkesh Roy, the Chief Executive of the port operator, said that he expects volumes to grow by 10%, up from 9% in fiscal 2025. This is despite signs that Asia's third largest economy has slowed down.
Roy stated that "we are not affected by the current trade uncertainty (caused by tariffs)... We (primarily) cater to the steel and energy sector, which is more domestic in nature."
Private port operators including Adani Ports, which is a rival, benefitted from steady cargo movements in India, until U.S. Tariff policies disrupted the global markets and added risks to a slowing economic.
Analysts at Jefferies noted, however, that JSW's focus, on bulk cargo, such as iron ore, coal and other domestically-oriented commodities, gives it greater protection from rising global trade risk than Adani Ports, with its container-heavy business model.
JSW Infra announced a 54% increase in profit for the fourth quarter on Wednesday. The growth was boosted by a volume increase in coal. However, the decline in iron ore volumes limited any gains.
Roy said that the steel market can expect to "do very well" with the recent introduction of safeguard duties.
JSW Infra increased its overall cargo volume by 5% on an annual basis, while increasing revenue in the fourth quarter by 17%.
Elara Securities had predicted a growth of 8%, but this was lower than last year. $1 = 84.5580 Indian Rupees (Reporting and editing by Eileen Soreng, Vijay Kishore).
(source: Reuters)