LONDON: Russian Urals crude weakened in the Mediterranean and Baltic on Wednesday despite healthy margins, and the paper market showed a further weakening was expected on a likely rise in supply and uncertainty over regional demand.
In the Platts window, Litasco offered a 80,000 tonne Aframax Urals cargo in the Mediterranean at dated Brent minus $1.15 a barrel, some 30 cents weaker than previous price estimates, but it saw no bids, traders said.
In the Baltic, Vitol sold to Unipec a Sept. 13-17 Urals cargo at dated Brent minus $1.35 a barrel, some 35 cents weaker than previous price estimates.
Russian oil firm Tatneft has acquired a vacant Sept. 21-22 slot to load 140,000 tonnes of Urals crude oil from the Black Sea port of Novorossiisk in September, industry sources said, in a move to effectively boost Russian supply.
Urals swaps showed that prices would weaken in the Baltic later this month and in October to dated Brent minus $1.60-$2.00 a barrel as Russia is expected to increase exports amid lower demand from refineries at home.
In the Mediterranean, Urals prices are expected to stay flat to slightly stronger in September and October, partially due to expectation the weather will worsen and make loading more difficult.
Saudi Arabia cut October selling prices to customers in Asia, Europe and the United States, effectively reflecting poor demand for crude from rival producers.
Libya's oil production has risen to 725,000 barrels per day (bpd) from 700,000 bpd last week, the state-run National Oil Corp (NOC) said on Wednesday.
The OPEC member's output has risen steadily as major oil ports in the east reopened after a deal between the government and a group of rebels.
Risks to production remain, given political unrest and lawlessness in the country. A group of rebels campaigning for autonomy in eastern Libya rejects the parliament set up by another armed group in Tripoli but will honour a deal to keep major oil ports open, a rebel spokesman said on Wednesday.
Britain on Wednesday lowered its travel warning for Arbil in Iraqi Kurdistan, prompting some oil companies to return foreign employees who had been evacuated as violence escalated.
Canadian oil producer Oryx Petroleum said it had restarted oil production at its Demir Dagh field, while Gulf Keystone Petroleum said it was returning around 50 foreign staff to its sites in the area.
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