W. Africa Crude-Trading muted as Asian buying slows By Reuters

W. Africa Crude-Trading muted as Asian buying slows
W. Africa Crude-Trading muted as Asian buying slows


© Reuters.

LONDON, May 4 (Reuters) – Trading largely paused and differentials remained steady as China suspended new buying for much of this week because of public holidays while resurgent COVID-19 cases undercut Asian demand elsewhere.

* May Day holidays in China will mean no new buying from West Africa’s top outlet for oil after state company Unipec purchased a couple of June-loading cargoes late last week.

* Renewed lockdown measures to combat new coronavirus waves in Japan, Thailand and India will further dent prospects for oil from West Africa, particularly Nigeria.

* India’s annual crude imports fell nearly 13% in the 2020-21 financial year to 198.11 million tonnes, its lowest in six years, as refiners cut crude processing. However, imports in March – the last month recorded – were higher than in February. Traders were awaiting a new buy tender from Indian state refiner IOC, which in the past couple of months provided major relief by absorbing multimillion-barrel supplies from Nigeria.

* New tenders could resume as late as the July-loading trading cycle because India retains abundant supply but has much reduced domestic demand.

* A wide Brent-Dubai spread meant that Atlantic basin oil grades continued to struggle to trade in Asian markets, with U.S. and Nigerian crude selling slowly but grades such as Brazilian Tupi still fetching premiums of about $1.50.

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* Top oil exporter Saudi Arabia is expected to cut its official selling prices (OSPs) for Asia in June, tracking weakness in Middle East benchmark Dubai and demand uncertainty in the face of new regional COVID-19 outbreaks, a Reuters survey showed. Health experts worry that public scepticism about taking the relatively small number of vaccine doses African countries have battled to procure could prolong a pandemic that has already killed more than 3.3 million people worldwide.

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