{"id":47899,"date":"2017-10-17T09:24:19","date_gmt":"2017-10-17T09:24:19","guid":{"rendered":"https:\/\/www.biphoo.com\/bipnews\/?p=47899"},"modified":"2017-10-17T09:24:19","modified_gmt":"2017-10-17T09:24:19","slug":"asia-oil-buyers-turn-to-u-s-in-hunt-for-cheap-supply","status":"publish","type":"post","link":"https:\/\/www.biphoo.com\/bipnews\/business\/asia-oil-buyers-turn-to-u-s-in-hunt-for-cheap-supply.html","title":{"rendered":"Asia oil buyers turn to U.S. in hunt for cheap supply"},"content":{"rendered":"

Asia oil buyers turn to U.S. in hunt for cheap supply<\/span><\/strong><\/span><\/h2>\n

Asia oil buyers turn to U.S. in hunt for cheap supply: As many as 11 tankers, partly or fully laden with U.S. crude, are due to arrive in Asia in November, with another 12 to load oil in the United States later in October and November before sailing for Asia, according to shipping sources and data on Thomson Reuters Eikon.<\/span><\/p>\n

U.S. West Texas Intermediate crude benchmark stands at its largest discount in years against the Atlantic Basin\u2019s Brent, with local appetite curbed as U.S. refineries are still pushing to get back on track in the wake of hurricanes such as Harvey.<\/span><\/p>\n

\u201cBetween November and January, there is a very big volume of U.S. crude heading to Asia,\u201d said a Chinese trader who has bought 4 million barrels of medium-sour U.S. oil to arrive in December. He declined to be identified as he was not authorized to speak with media.<\/span><\/p>\n

The price-spread between the two crudes had already pushed U.S. crude exports to a record 1.98 million barrels per day by late September, according to the Energy Information Administration in the United States.<\/span><\/p>\n

Exports in the next two to three weeks could hit 2.2 million bpd, Marco Dunand, chief executive of trading house Mercuria, said last week.<\/span><\/p>\n

That has also been driven as some Asian governments look to diversify supply sources and reduce trade surpluses with the world\u2019s top economy. India joined China, Japan and South Korea when it imported its first U.S. crude in October.<\/span><\/p>\n

And high premiums for Middle Eastern grades of crude are also stoking Asian appetite for U.S. supplies.<\/span><\/p>\n

\u201cU.S. medium sour grades can replace most Middle East grades and the light sweets may replace some African crude,\u201d said the Chinese trader.<\/span><\/p>\n

DESTINATION ASIA<\/span><\/p>\n

The tankers to arrive in Asia in November include eight Very Large Crude Carriers (VLCC), capable of carrying 2 million barrels of oil each, and three Suezmaxes that can load half that volume, according to shipping data in Eikon.<\/span><\/p>\n

China remains the largest buyer with four tankers, followed by three to South Korea and two to India. The remaining two could head to Singapore, the data shows.<\/span><\/p>\n

Unipec, the trading arm of Asia\u2019s largest refiner Sinopec, dominates the trade with imports set to hit 5.7 million tonnes in 2017, up from 3.6 million tonnes in the first eight months, a source familiar with the matter said. The company buys about 8 million barrels of U.S. crude on average per month, the source said. Reuters could not immediately reach the company for comment.<\/span><\/p>\n

Another 12 tankers are provisionally chartered to load U.S. oil in October and November, the data showed.<\/span><\/p>\n

Four of these are supertankers chartered by South Korean buyers to load Mexican and U.S. crude. The country\u2019s top refiner SK Energy [SKENGG.UL] has bought 6.5 million barrels of U.S. crude to be delivered between November and January.<\/span><\/p>\n

Several Indian refiners have also purchased their first U.S. crude for delivery in the fourth quarter, including the country\u2019s largest refiner Indian Oil Corp.<\/span><\/p>\n

Japan\u2019s largest refiner JXTG Holdings has provisionally chartered a VLCC to load crude in Mexico and the U.S. Gulf in November. The company declined to comment on individual trades.<\/span><\/p>\n

Source:http:\/\/www.reuters.com\/article\/us-usa-asia-oil\/asia-oil-buyers-turn-to-u-s-in-hunt-for-cheap-supply-idUSKBN1CL0RH<\/span><\/p>\n

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