Japan Bans Russian Coal Imports
April 8, 2022
The huge news of the release of 240 million barrels of oil from SPR around the world put some selling pressure on price temporarily. These actions have had some near-term impact on prices for the next few months but farther out on the forward curve prices are holding steady or moving higher. The market is still concerned about what happens in six months when the market still doesn’t have enough production and supplies to meet demand. Those concerns are being impacted by the push to go green and the negative outlook on fossil fuels. There is no clear plan or strategy at this point to make this situation look hopeful.
Japan the world’s 3rd largest coal importer has banned imports from Russia.
Shell said it diverted $7 billion of its cash flows partly to cover hefty oil and gas margin calls, becoming the first company to publicly acknowledge the pressure commodities trades have faced in 2022 from extreme price rises and volatility.
Russia’s production of oil and gas condensate fell to 10.52 million BPD on April 1st-6th from a March average of 11.01 million BPD. Sources stated that output declines further to 10.44 million BPD on April 6th as Russia has some difficulties exporting amid the western sanctions imposed on the country.
ANZ said even the biggest release of oil from the SPR is unlikely to curb rising prices. It lowered its short-term or 3-month oil price target to $115 per barrel from a previous estimate of $135 per barrel. It expects the global oil market balance to be less tight in the next six months. It said global inventories will significantly decrease, particularly if the 60 million barrels IEA members would release are taken into consideration. It however increased its 12-month oil price target from $85 per barrel to $115 per barrel.