MOSCOW: Urals differentials eased again on Tuesday in northwest Europe due to lower demand for Urals in the region and expectations of ample supplies in September.
A preliminary loading plan for early September was released with minor changes to the August plan. Urals exports from Baltic ports on Sept. 1-7 are planned at 1.3 million tonnes, 100,000 tonnes lower than in August, and from Novorossiisk at 0.54 million tonnes, unchanged from August.
Traders expect Urals exports in September to rise compared to August due to the start of seasonal maintenance on refineries and lower export duty for Russian crude oil.
Also Urals exports from Novorossiisk and Ust-Luga were lower in August due to maintenance on pipelines which is not planned for September.
In the Platts window Vitol offered 100,000 tonnes of Urals loading from Baltic ports on Aug. 31-Sept. 4 down to dated Brent minus $2.15 a barrel, but no buyers were found.
On Monday Trafigura sold 100,000 tonnes of Urals loading on Aug. 26-30 to Shell at this level. In the Mediterranean, Urals differentials were unchanged due to a lack of trading activity.
Traders still assessed Russian crude in the region around dated Brent minus $1.80 a barrel for 80,000 tonne cargoes and 140,000 tonne cargoes with 50 cent discount to smaller ones. Premiums for Azeri light continued to shrink amid poor refining margins and limited arbitrage possibilities.
In the Platts window Japan's Itochu sold 85,000 tonnes of Azeri light loading on Sept. 1-5 at a premium of $1.40 a barrel to BFOE to Gunvor, traders said. The trade was 10 cents lower than recent estimations.
Traders did not expect premiums for Azeri light to recover soon due to weak demand for cargoes loading in the first half of September, but market participants said cargoes loading in the end of September could achieve higher levels.
CPC Blend differentials remained unchanged in slack trade, but traders added that poor refining margins were weighing on the grade's price levels.
The world's largest oil trader Vitol has won the right to export Kazakhstan's share of output from the giant Kashagan field, further strengthening its position in the central Asian nation as it prepares for an oil production jump.
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