SINGAPORE: The Asia-Pacific crude market held firm on Wednesday as robust demand from Thailand helped soak up excess supplies.
PTT bought several cargoes for delivery in early January including Labuan from Shell, Seria Light from Itochu and Kimanis from Lukoil, traders said. The Thai trader may have also bought a Kutubu cargo, they said, although details could not be independently verified.
Pertamina will close a tender on Wednesday to buy sweet crude for January delivery. The Indonesian refiner has earlier bought Qua Iboe from Shell.
Strong freight rates and robust demand from China have supported differentials for December-loading regional crude, although there are signs that the market may be cooling, a trader said.
"There are still some prompt cargoes available," he said, adding that Chinese buyers may turn to ESPO, away from regional grades, after a sharp drop in premiums for the Russian crude.
Consultancy PIRA Energy said refinery maintenance and refiners' need to reduce inventories for end-year accounting purposes will weigh on prices in the short term.
"Longer term, the market will increasingly need additional barrels, even after accounting for the return of Iranian barrels in spring 2016. By 2Q16, the market will have to begin signalling that more oil will be required and prices should begin a more sustained recovery by the second quarter next year.
Brent-Dubai Exchange of Futures for Swaps (EFS), or Brent's premium to Dubai swaps, was at $2.14 and $2.24 for December and January, respectively.
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