RTRS:Asia-Pacific Crude-Direct-burn crudes under pressure
SINGAPORE, Oct 15 (Reuters) - Differentials for Asia Pacific crudes
typically used for direct burning in power stations were under more pressure on
Monday due to slowing demand from Japanese power stations and surplus supply.
Indonesia's Duri crude, reflective of direct-burn crudes in the region, was
valued at a discount of $3-$3.50 a barrel, to Dated Brent, by some traders.
High inventories in Japan of direct burn crudes, and alternatives like
liquefied natural gas (LNG) was expected to keep markets depressed through the
end of the year.
"The yen is rising, the economy is slowing and that translates to weaker
electricity demand," a trader said.
"We also see a slowdown in manufacturing activity which is also going to
have an impact on electricity demand."
On Friday, the Japanese government downgraded its view of the economy in
October, as worries about Europe's debt crisis and China's slowdown worsened.
The latest data showed Japan's industrial production fell to a 15-month low
in August on sagging sales to top export market China and business confidence
dented by euro zone crisis.
Further problems at Vietnam's Dung Quat refinery is expected to keep
pressure on crude grades like Bach Ho, which can also be used as a direct burn
crude.
"It doesn't help you have problems with that refinery, so now you getting
surplus barrels on the market with no home, super bearish," a trader said.
Malaysian state oil firm Petronas has increased the Tapis crude price alpha
factor for October liftings to $3.50 per barrel, up 45 cents from the previous
month, an industry source said on Monday.
* TENDERS
- Taiwan's CPC issued a tender to purchase up to 650,000 of condensate for
loading in December. The validity of the tender ends on Oct 17.
- India's MRPL purchased 1 million barrels of December loading Zafiro at
Dated Brent plus $2.50 a barrel from Trafigura.
- Vietnam's PV Oil issued a tender to sell 300,000 barrels of Ruby crude for
loading on December 14-20.
* MARKET NEWS
- China, the world's second largest oil consumer, has set its 2013 non-state
crude oil import quota at 29.1 million tonnes, the same as this year, the
Ministry of Commerce said on Monday.
- Sudan expects to double its oil production in the next two years, to
300,000 barrels per day, as it steps up oil exploration, the country's petroleum
minister said on Monday.
- European Union governments plan to ratchet up sanctions pressure against
Iran over its nuclear programme on Monday, approving new measures against
Tehran's banking sector, industry and shipping.
CRUDE Price Prev Change
NOV Brent 114.34 114.94 -0.60
NOV Brent/Dubai EFS 4.17 4.20 -0.03
DUB-EFS-1M
PRODUCT CRACKS
NOV fuel oil crack -8.94 -9.37 +0.44
