We are now around 4 months into this global pandemic, and in the analysts’ world ideas about oil demand and how it may rebound are converging. In mid-April we did a webinar reflecting the wide range in expectations of the collapse in global oil demand and how quickly it may recover. At that time views varied from a ‘minimal’ loss of 15 million b/d in April (versus April 2019) up to an extreme case of a 28 million b/d loss. Also, the perception back then was that oil demand would recover back to 2019 levels by the end of this year.

For a number of months the world has been dealing with the Covid-19 pandemic. Despite this, shipping has on average only seen modest declines in activity and the bunkering industry continued to develop with new production and supply locations appearing on the map.

The absolute level and structure of oil prices has changed massively over the past month. We have moved from a position where prices were falling fast and the extent of contango was huge to one now where prices have risen and the contango almost disappeared.