Middle East crude benchmarks Oman and Dubai edged up on Monday after Saudi Arabia cut October prices for Asia.
SAUDI OSP
Top oil exporter Saudi Arabia has cut the October price for flagship Arab light crude to Asia to the lowest in nearly three years on concerns of weak demand in the region.
The October official selling price (OSP) for Arab Light fell by 70 cents to $1.30 a barrel above the Oman/Dubai average – the lowest since November 2021- Saudi Aramco said in a statement late on Friday.
The drop is at the deeper end of expectations. In a Reuters survey, three of five sourcesat Asian refineries had said the price was expected to fall between 50 cents and 70 cents a barrel.
A source at an Asian refinery said the cut was deeper than what he had expected, adding that there was ample supply in the market.
The October OSP for Arab Heavy crude for Asia had a deeper reduction of $1.00 a barrel, with demand set to taper off following the conclusion of peak summer fuel oil consumption, while Middle East producers are facing increasing competition from Canadian exports from the expanded Trans Mountain pipeline (TMX).
ARBITRAGE
Chinese refiner Rongsheng Petrochemical has bought four cargoes of Canadian Access Western Blend (AWB) crude for November arrival, traders said.
The cargoes were sold at discounts of more than $6 a barrel to ICE Brent, they said.
SINGAPORE CASH DEALS
Cash Dubai’s premium to swaps rose 1 cent to $2.01 a barrel.
NEWS
Global commodity traders Gunvor and Trafigura anticipate oil prices may range between $60 and $70 per barrel due to sluggish demand from China and persistent global oversupply, executives told a conference on Monday.
Colombia’s majority state-owned oil company Ecopetrol ECO.CN hopes to resume normal oil production by the end of the week from its fields shut due to protests by truckers over a rise in diesel prices, the company’s chief executive said on Monday.
Gunvor Group is growing its Asia operations to expand in existing markets such as liquefied petroleum gas (LPG), naphtha, gasoline and aromatics as well as into new areas including power, its chairman said.
Bahrain’s state-owned Bapco Energies plans to import heavier crude after the expansion of its 267,000 barrel-per-day (bpd) refinery to 380,000 bpd, said its senior vice-president for business development and international and government relations.
China’s shift towards lower-carbon fuels and a sluggish economy are dampening oil demand growth in the world’s largest crude importer, speakers at the APPEC conference said on Monday.
India plans to have a third of its heavy duty long-haul trucking fleet fuelled by liquefied natural gas (LNG) instead of diesel in five to seven years to cut pollution, according to a draft policy from the federal oil ministry.
A halt in Libyan oil exports has supported the values of Azeri, African and U.S. oil grades, while some refiners could consider reducing crude intake altogether due to poor profit margins, traders and analysts told Reuters.
Source: Reuters (Reporting by Florence Tan; Editing by Eileen Soreng)