Middle East crude benchmarks Oman, Dubai and Murban drifted higher on Tuesday as the military clashes between Israel and the Palestinian Islamist group Hamas were in focus, fanning concerns of supply disruption.
The market continued to watch the Middle East turmoil and any indication on harsher sanctions on Iran, who has long backed Hamas.
Iran’s top authority Ayatollah Ali Khamenei said on Tuesday that Tehran had not been involved in the Hamas group’s weekend attack on Israel, but he hailed what he called Israel’s “irreparable” military and intelligence defeat.
Prices of Iranian oil are flat in China, where most of the cargoes land, and Chinese independent refiners are in no rush to increase their purchases despite the supply uncertainty, several trading sources said.
“China’s appetite for Iranian oil has almost reached a peak as independent refiners are short of crude import quotas and their refining runs are capped by margins,” said one source.
Shiptracking data from Kpler showed that China’s October imports of Iranian crude are estimated to fall to 1.1 million barrels per day (bpd) from a record high of 1.4 million bpd in September.
SAUDI ALLOCATION
Saudi Aramco has notified at least four North Asian buyers that it will supply full contractual volumes of crude oil in November, sources with knowledge of the matter said on Tuesday, as the Kingdom maintained its output policy.
Refiners in China, the largest buyer of Saudi crude oil, have kept their nominated volumes steady in November, totalling around 47 million barrels, compared with about 50 million barrels in the prior month, the sources said.
OSP
Iraq’s State Oil Marketing Organization (SOMO) raised official selling price (OSP) for Basra Medium to Asia to $2.10 a barrel over /Dubai average in November, from $1.80 in the prior month.
It set the November OSP for Basra Heavy to Asia at a discount of $1.40 a barrel against /Dubai average, up from a discount of $1.80 a barrel in October.
SINGAPORE CASH DEALS
Cash Dubai’s premium to swaps rose 16 cents to $2.92 a barrel.
NEWS
Venezuela and the U.S. have progressed in talks that could provide sanctions relief to Caracas by allowing at least one additional foreign oil firm to take Venezuelan crude oil for debt repayment if President Nicolas Maduro resumes negotiations with the opposition in Mexico, five sources said.
Kuwait’s oil minister announced a new strategy to boost fossil fuel production on Monday and said his country would prepare the infrastructure for the Durra gas field, which it shares with Saudi Arabia and Iran claims a stake in.
Top U.S. oil producer Exxon Mobil’s XOM.N planned acquisition of the No. 1 Permian shale producer Pioneer Natural Resources PXD.N could further restrain output growth in the largest U.S. oilfield, squeezing pipeline companies and suppliers, executives and energy advisors said.
Nigeria’s national oil firm NNPC Ltd has again become the sole importer of petrol because local private firms are unable to obtain foreign currency, its chief executive said on Monday, four months after imports were opened up to private players.
Source: Reuters (Reporting by Muyu Xu; Editing by Sherry Jacob-Phillips)
