Bloomberg News

Mercuria Bids for Forties Oil; Vitol Sells Urals at Lower Price

August 23, 2012

Mercuria Energy Trading SA failed to buy North Sea Forties crude at a higher price than its previous bid. Vitol Group sold two Russian Urals cargoes in Europe at bigger discounts to Dated Brent than its last offer.

CPC Corp., a Taiwan state-run oil company, bought via a tender 4 million barrels of Angolan crude for loading in October, said three traders who participate in the market.

Asian refiners will reduce imports of West African crude in September by 9.4 percent from August to near the lowest level this year, a survey of six traders and an analysis of loading programs obtained by Bloomberg News showed.

North Sea

Mercuria failed to buy 600,000 barrels of Forties for loading on Sept. 15 to Sept. 17 at 65 cents a barrel more than Dated Brent, 5 cents above its bid yesterday, according to a Bloomberg survey of traders and brokers monitoring the Platts trading window.

Total SA didn’t manage to buy a cargo for Sept. 15 to Sept. 17 at 60 cents more than Dated Brent, while Vitol bid for a shipment for Sept. 2 to Sept. 4 at parity to the benchmark, the survey showed.

Mercuria failed to sell a consignment of the blend for Sept. 10 to Sept. 12 loading at 80 cents more than Dated Brent, according to the survey.

Reported crude trading typically occurs during the Platts window, which ends at 4:30 p.m. London time. Before the session, Forties loading in 10 to 25 days was 2 cents a barrel more than Dated Brent, up from parity yesterday, data compiled by Bloomberg show.

Brent for October settlement traded at $116.15 a barrel on the ICE Futures Europe exchange in London at the close of the window, up from $114.84 yesterday. The November contract was $115.47, a 68 cent discount to October.

Forties lot F0901 will be shipped on Aug. 31 to Sept. 1, one day earlier than planned, two people with knowledge of the export program said.

One Ekofisk cargo for loading in September was added to the program, bringing total shipments to 15, said two people who declined to be identified because the information is confidential. The consignment will be exported on Sept. 24.

Mediterranean/Urals

Vitol sold 100,000 metric tons of Urals for Sept. 2 to Sept. 6 loading to Eni SpA at $1.35 a barrel less than Dated Brent on a delivered basis to Rotterdam, compared with its offer yesterday at a discount of $1.10, according to the survey.

Vitol also sold 80,000 tons for Sept. 3 to Sept. 7 loading to Eni at a discount of 70 cents on a delivered basis to Augusta, Italy, 10 cents less than its offer yesterday, according to the survey.

Urals was at 61 cents a barrel less than Dated Brent in the Mediterranean, the lowest since July 3, compared with a discount of 20 cents in the previous session, according to data compiled by Bloomberg.

“Upcoming refinery turnarounds in Europe and the anticipation of a longer September loading schedule, on the back of higher Russian refinery maintenance, took some steam out of Urals values,” Vienna-based researcher JBC Energy GmbH, said today in an e-mailed report.

Further declines in Urals will be limited, it said. “Missing Iranian, Buzzard and Syrian barrels and ongoing delays with Kirkuk supplies will ensure that the market remains short on sour crude,” according to JBC Energy.

Iraq plans to increase exports of its Kirkuk crude in September from the Turkish port of Ceyhan to 18 cargoes, four more than this month, according to a loading program obtained by Bloomberg News.

Exports will total 12 million barrels, or 400,333 barrels a day, next month, the plan showed. That compares with 196,774 barrels a day planned for August.

West Africa

Nigerian benchmark Qua Iboe fell 1 cent to $1.52 a barrel more than Dated Brent, according to data compiled by Bloomberg.

CPC bought via a tender 3 million barrels of Cabinda and 1 million barrels of Palanca grade, according to the people, who declined to be identified because the information is confidential. CPC purchased the crudes from Chevron Corp., Sonangol Holdings and Total, they said.

Royal Dutch Shell Plc and Vitol sold a total of 2 million barrels of Nigerian crude for October loading to Bharat Petroleum Corp. said two traders involved in the region’s oil.

Shell sold 1 million barrels of Bonny Light, while Vitol will supply 1 million barrels of Akpo grade, they said.

Nigeria plans to increase daily crude exports for October by 2 percent from September, according to shipping schedules.

The country will export 74 cargoes totaling 66.5 million barrels, or 2.15 million barrels a day, in October, loading programs showed. This compares with 69 shipments amounting to 2.1 million barrels for September.

Exxon Mobil Corp. will shut the Zafiro oil field in Equatorial Guinea for about 15 days in October for planned maintenance, said two traders with knowledge of the matter. Adelfa Novaria, a Houston-based official at Exxon Mobil, which operates the 120,000 barrel-a-day offshore field, wasn’t able to comment on the matter when reached by phone today.

Exports of Zafiro crude will be reduced to two cargoes of 1 million barrels each in October, one less than September, according to a loading program.

Ghana will ship three cargoes of 950,000 barrels each of Jubilee crude in October, compared with one in September, a revised loading program showed.

The September plan was reduced to one cargo from two after one lot was brought forward to end-August, according to another revised schedule.

Chad plans to export four 950,000 barrel cargoes of Doba crude in October including one lot deferred from September, according to a loading plan. Shipments in September were revised down to three consignments from four, the plan showed.

Asian refiners bought 51 cargoes totaling 1.6 million barrels a day from West Africa, the survey showed. This is less than the 59 shipments amounting to 1.76 million barrels a day planned for this month, and close to the year-low of 1.41 million barrels in July. Exports from Angola fell below one million for the first time in 2012.

To contact the reporter on this story: Sherry Su in London at lsu23@bloomberg.net

To contact the editor responsible for this story: Stephen Voss at sev@bloomberg.net


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