Commodities Focus

Coal markets are giving way to the coronavirus pandemic as cascaded demand and international government regulations left producers presented with the complex decision to slash supply. Sarah Matthews discusses the situation with EMEA coal market specialist Joseph Clarke, Asia market specialist Fred Wang and Jenny Ma, and Americas market specialists Tyler Godwin and Olivia Kalb.

California is showing significant power price drops as a result oversupply, congestion and decreasing demand, with renewable curtailments increasing.

S&P Global Platts senior natural gas writer Harry Weber and S&P Global Market Intelligence midstream finance reporter Allison Good preview the upcoming release of first-quarter earnings results by companies in the North American midstream sector. It will be the first opportunity for the market to see how extensive the impact of the coronavirus pandemic has been on operators of pipelines, processing facilities, gathering systems and liquefaction terminals. The near-term outlook is expected to be dim for many.

US crude storage has quickly become an overwhelmingly important issue as the global market continues to grapple with an oversupply of crude and dramatically dwindling demand in light of the coronavirus pandemic. A steep contango in the oil market structure has created the huge incentive for traders and producers to store away their barrels instead of selling it on a prompt physical basis and this is quickly overwhelming storage availability. Joining the podcast is Richard Redoglia, the CEO of Matrix Global Holdings, which launched the world’s first futures contract on crude oil storage capacity and holds monthly storage contract auctions.

Global demand for commodities has been obliterated. From copper as a barometer of the global economy to oil as a potential inflation hedge, no commodity has escaped the impact of coronavirus. Jeff Currie, head of commodities research at Goldman Sachs and someone who identified the commodities supercycle in the 2000s, did a Q&A with the London news team at S&P Global Platts on 7th April hosted by Paul Hickin and Andy Critchlow. He discussed what a potential supply and demand recovery could look like and what the OPEC+ deal could mean for crude markets. In a wide-ranging discussion he brought his insight to LNG, the broader metals complex, shale oil and energy transition too.

US power markets are following similar trends from Asia and Europe following the coronavirus track, which is creating supply and demand challenges. Peakload averages were down more than 10% in March compared with a year earlier, power dailies have yet to see a dramatic impact, and pricing forwards experienced movement that was more drastic in March for April and May packages.

S&P Gloal Platts senior natural gas writer Harry Weber and S&P Global Market Intelligence natural gas reporter Corey Paul discuss with Platts senior digital editor Jason Lindquist current trends in the North American and global LNG markets amid ongoing headwinds, including low prices, narrow margins, shifting trade flows and a significant dropoff in commercial activity that has been exacerbated by the coronavirus pandemic. The outlook has been clouded by extraordinary uncertainty about the near-term trajectory of supply and demand fundamentals.

With COVID-19 lockdowns in Europe rapidly bringing the petrochemical demand into a lull, pressure on the upstream naphtha market has become two-fold in the recent weeks. Travel restrictions and the progressive loss in demand from the petrochemical sector have added extra weight. S&P Global Platts ethylene and naphtha editors look closely at the cycle of events since the coronavirus breakout.

S&P Global Platts agriculture specialists Liz Thang, Rafael Savoia, Sergio Alvarado, and Andrei Agapi examine the factors driving corn prices as trading communities in Asia and the Americas try to manage market volatility and logistics disruptions due to the coronavirus pandemic, as well as the usual weather issues.

The tsunami of IMO 2020 turned into a tidal wave of cheap oil as producers flood the crude oil market and refiners cut runs amid the COVID-19 demand destruction. In the meantime crude is heading toward containment in tankers floating offshore. Catherine Wood and Barbara Troner of the S&P Global Platts shipping team put their heads together with Platts crude editor Kristian Tialios to explore the dynamics of current floating storage plays.