All eyes around the world have quite rightly been focused on the dramatic and increasingly depressing news related to the coronavirus, but those who are also looking at the implications for an extremely worrying world economy, will be wondering what might come out of the urgent gathering of OPEC, OPEC+, and potentially other friends of friends this weekend. The crude oil market has been severely jolted by the demand impact of coronavirus, and a spat between alleged friends, Messrs.
We are being told to expect the worst, as coronavirus numbers ramp up here in the U.K. and in many countries around the world. The Hill family are reducing our exposure to the outside world, implementing our social distancing, kissing good-bye to a steady income from our restaurant as it shuts before it has even fully opened, try to home school our 3 boys who appear to be skin grafting themselves to their computers, but please spare a thought for me if you can.
Wow, it’s been a week to forget, and it looks as if there’s more bad news on the horizon, for the markets, for energy as a whole, for LPG, as well as for you and me. Last Friday the Dow Jones stood at a hundred or so points off 26,000, and in one week it had fallen to below 21,500 points, but with a degree of “dead cat bounce”, and a positive reaction to President Trump’s emergency coronavirus declaration and financial stimulus programme, it’s jumped back up to just over 23,100 by Friday’s close. Although the President announced a buying spree, whereby the U.S.
As the freight rate for the standard Houston to Chiba voyage drops into the nineties, it’s maybe time for the VLGC owners, and disponent owners alike, to buckle-up tightly as things are about to get a little more bumpy in the LPG shipping market! But it’s not time for despair, there is light at the end of the tunnel, albeit probably not until the latter part of the year. Therefore ship owners need to react, sooner rather than later, or they could easily be left again at the back of the queue.
William Shakespeare famously wrote, “All the world’s a stage, and all the men and women merely players”. It’s something that grabbed my thoughts as I wandered the Mayfair streets from meeting to meeting last week, at a somewhat abbreviated Institute of Petroleum gathering in London. A lot of the big parties had been cancelled, many players had decided to stay at home or leave earlier than normal. It definitely struck me, as individuals in the LPG industry, that we were “merely players”, and the world was starting to act-out a scene that might take us somewhere we haven’t been before.
Once you hit your late fifties, you’re supposed to start saying, “it’s not like it was in my day”, whatever that might mean. Without doubt the politicians of today are certainly different to what I can remember, as are their advisors. In the U.K. Boris Johnson has Dominic Cummings as his chief advisor, a man who orchestrated the “Leave” campaign, as well as the stonking majority Boris won at the recent General Election, and is now advising that he is adamant on getting as many “weirdos and misfits” into the avenues of government.
It’s been somewhat of a topsy turvy week in the energy sector, as market players try to wriggle out on the other side of the bed each morning, especially on Valentine’s Day! As always, once we’ve had a few weeks of bad news, driven by a worsening but not yet catastrophic coronavirus epidemic, we know that around the corner there will be change, whether it’s tomorrow, next week or next year. So, can we say there’s been any change yet?
Before I start, I must say the headline I’ve used is nothing to do with swearing, although having said that, I did find time for a chuckle this week, hearing President Trump, in his post impeachment acquittal celebratory speech, say the word “bull****”, a word maybe a little more acceptable across the pond than here in the U.K., especially on the BBC. Although the live broadcast had no time to react, the subsequent news programmes had the second syllable bleeped out. The BBC always seems to be trying to get what is wrong, right, albeit after the event!
I read somewhere this week that after the trials and tribulations of the first month of a new decade, the last few days of January have been “very unremarkable”, but I beg to differ. To me the most important announcement for months came to the surface, specifically impacting LPG, not some knock-on effect of an action or decision made outside of our industry. To set the scene, it was 1000 hours on Wall Street, 0900 hours in Houston, the Wall Street Journal, CNBC, Bloomberg and the Motley Fool, to name just a few, had their pens, electronic transcribers and microphones at the ready.