Saturday, 18 March 2017

Asia-Pacific Crude-Stays weak; ESPO falls to lowest since 2015

In Oil & Companies News 18/03/2017

Asia-Pacific crude market stayed weak on Friday as ample supplies and lower demand in the region due to seasonal refinery maintenance weighed on spot premiums for May-loading cargoes. Russian oil producer Surgutneftegaz has sold three cargoes of ESPO crude loading in May at the lowest premiums since 2015, traders said. The cargoes were sold at $1.60-$1.80 a barrel above Dubai quotes, they said.
The premiums are the lowest since prices recorded in September 2015 for oil loading in July that year, according to data on Thomson Reuters Eikon. More details emerged for ExxonMobil’s Sokol tender.
The oil major sold two of three May-loading cargoes it offered at $1.85-$.195 a barrel above Dubai quotes, down from premiums of just above $3 in the previous month. Shell may have bought one cargo, a trader said. For regional grades, traders are watching results of tenders from Petronas and IRPC to gauge how much lower spot differentials could go. Besides Bertam and Bunga Kekwa, Petronas may also offer a Bunga Orkid cargo to load on May 14-20 in a tender next week.
The outlook for Kimanis remained weak. A trader said the May premium for Kimanis may drop below $2 a barrel soon. Separately, BP and Trafigura were the buyers of May-loading Kutubu crude while Petro-Diamond bought a Ruby cargo via a tender at $2.20 a barrel above dated Brent, traders said. Brent’s premium to Dubai swaps, or Brent-Dubai Exchange of Futures for Swaps (EFS) , was at $1.33 for May, down 9 cents from the previous session.
*TENDERS COUNTRY/COMPANY GRADE VOL CLOSE (VALID) LOADING DATE MALAYSIA/PETRONAS s:Bertam 350KB Mar 17 (Mar 20) May 4-8 MALAYSIA/PETRONAS s:Bunga 300KB Mar 17 (Mar 20) May 3-9 Kekwa VIETNAM/PV OIL s:Song doc 200KB Mar 17 (Mar 24) May 10-16 RUSSIA/ROSNEFT s:ESPO 2*740KB March 15 (March 20) May 9-15, 22-27 THAILAND/IRPC b:sweet March 15 (March 16) April 21-May 10 arr THAILAND/MUBADALA s:Manora 2400-2500KB Mar 18 (Apr 10) Jun 2017-May PETROLEUM 2018 VIETNAM/PV OIL s:Chim Sao 2*300KB Mar 14 (Mar 17) May 9-13, 23-27 QATAR/QATAR s:DFC/LSC NA Mar 14 (Mar 15) May loading PETROLEUM TENDERS AWARD COUNTRY/COMPANY GRADE VOL COUNTERPARTY/PRICE LOADING DATE *RUSSIA/SURGUT s:ESPO 3*740KB Dubai +$1.6-$1.8 April 30-May 5, May 3-8,5-10 *RUSSIA/EXXON s:Sokol 2*740KB Dubai +$1.85-$1.95 May
*REFINERY
Sinopec is nearing an agreement to buy a majority stake in Chevron Corp’s South African assets, which are estimated to be worth $1 billion, two people familiar with the transaction said.

*MARKET NEWS
Freight rates for very large crude carriers (VLCCs) are likely to remain under pressure with hire rates from the Middle East to Asia tracking lower in the face of excess tonnage in the market, brokers said. Australian investment bank Macquarie Group Ltd agreed to buy Cargill Inc’s petroleum business, the commodities trader said on Thursday, the latest reshuffling of its business following an almost three-year slump in oil prices.

Oil exports from Iraq’s southern terminals have edged lower so far in March, according to loading data and an industry source, although not as much as expected, potentially raising questions over the country’s compliance with OPEC production cuts. Halfway into an OPEC-led oil supply cut, Asia remains awash with fuel in a sign that the group’s efforts to rein in a global glut have so far had little effect. Thomson Reuters Oil Research and Forecasts data shows around 714 million barrels of oil are being shipped to Asia this month, up 3 percent since December when the cuts were announced.
Venezuelan state oil company PDVSA has offered Russian counterpart Rosneft a stake in a joint venture in the country’s Orinoco Belt extra-heavy crude area, five industry sources said, in a sign of the Latin American nation’s dire economic situation and Moscow’s growing muscle there. For crude prices, oil product cracks and refining margins, please click on the RICs below. Brent Dubai Brent/Dubai EFS PRODUCT CRACKS Fuel oil crack Gasoil crack Naphtha crack Complex refining margins


Source: Reuters (Reporting by Florence Tan and Olga Yagova; Editing by Amrutha Gayathri)