Plus, regional gas prices converge around all-time lows, European steel and aluminum demand plummets, and Asian gasoline markets expect little relief from oversupply.
What's happening? Some super tankers are being booked to store crude for up to three years—potentially the longest ever duration for floating storage—as traders seek to profit from hoarding oil to cope with the current oil demand and supply shocks. The race to secure floating storage has picked up significantly in recent weeks, with up to 40 VLCCs and 20 Suezmaxes already placed on long-term chartering, according to S&P Global Platts estimates.
What's next? Freight rates and storage costs have ballooned as the market faces the prospect of more oil just as demand destruction due to the spread of coronavirus escalates. This has raised the stakes over how the world's biggest producers, the US, Russia and Saudi Arabia will confront the challenges of competition over market share, lower prices and potentially a lack of buyers for their crude.
What's happening? Global gas prices have again converged, this time around record lows, pressured by the mild northern hemisphere winter, high gas stocks and a still oversupplied global market. The JKM benchmark LNG price has fallen to an all-time low of just $2.26/MMBtu for the front month, bringing it down closer toward the prompt TTF and Henry Hub prices.