I was kindly invited to attend the first Argus LPG Awards for Excellence ceremony, this week in London’s Science Museum. I have to say it was a great success, and was lovely to see such a broad representation of our business, and some worthy winners as well. “You know who” picked up the best trader award, yes I do mean Seb Willems at Glencore, and he’d already got his winner’s speech prepared, that’s why he is #1, it’s all in the preparation! Mary-Jane Hogg deservedly won the executive of the year, and there were awards for Ineos, GE Power and Noreen Howat at Aggreko.
It’s looking as if it’s been another one of those weeks in the LPG world, where defining a forward view of the market could go one of many ways, and the backcloth is an ARB market that initially headed south but has now regained some broader momentum. In today’s SIMON SAYs I’ll take a look at what the key indicators are up to, and what has happened to them over the last couple of weeks, to see if there’s a clearer direction going forward, as cargoes are starting to be talked for the January 2020 arrival period in Asia.
I tried broking once when I was in between jobs way back in the early 90s. The company was called Kinetic Energy and amazingly to me I was fixing cargoes (not enough of them I must say) intra Mediterranean, loading from Libya, Algeria, Greek and Italian refineries, Lavera and then trying to broke them into Morocco, Spain, Turkey and Italy. Most of the cargoes were small and I can’t say I caused any major impact, maybe a stir or two.
There’s nothing that makes a ship owner smile more than seeing a decent number of ships getting fixed in the market, of course the grin widens if the rates are also edging up, and if the levels are jumping up, well I’ll leave that one for you to decide. As all eyes last week were focused on the consequences of the drone attack at Saudi Arabia’s key crude oil processing facility in Abqaiq, charterers hesitated for a while, but not for that long.
Yesterday I explored the implications for LPG as a result of last week’s drone attack on the Abqaiq crude processing facility in Saudi Arabia, that the damage is probably far greater than has been explained so far, and that Saudi Arabia’s current focus is on security, crude oil and the impending IPO of Aramco.
August is probably the worst time for markets to get the jitters, the players are away, and any move ends up being exaggerated beyond every normal expectation. We’re all a bit worried at the moment about “demand”, the world macro-economic type, and the lack of LPG buyers in Asia, Europe, pretty much everywhere. The uneasiness is made worse for all of us in the LPG world, as the two are very much related, whether we like it or not.
I’m just squeezing into my morning suit and putting on my top hat, as we head off for our annual Royal Ascot, day at the races. Usually I’m going thinking, how far under 90% of naphtha will the petrochemical buyers push the propane market in Europe, or will our customers try to push dates back again or isn’t it time for buyers to start stock building at the bottom of the market.