Middle East

Saudi Arabia's state-owned Saudi Aramco informed its term buyers that it slashed term allocations by 15-20% from contractual volumes. In addition, Iraqi State Oil Marketing Organization (SOMO) reduced term supplies by 10%-20%. The moves reflected the supply cut deal by the Organization of the Petroleum Exporting Countries (OPEC) plus and raised views that the demand/supply fundamentals would tighten. Under the circumstances, medium heavy grades for July-loading strengthened. State-owned Qatar Petroleum (QP) sold two cargoes of Al Shaheen for 3-4 and 13-14 loading in its sell tender closed on Wednesday. Both of the cargoes were sold to South Korea GS Caltex and the average of the awarded price was heard at a discount of $2.00 to Dubai quotes

Africa/Europe/Russia/America

Spot differentials for June-loading Sudan Nile Blend strengthened. Chinese end-users actively bought medium/heavy grades including Nile Blend aggressively, which buoyed the Nile Blend market. Senning, an affiliated company of China National Petroleum Corp (CNPC), sold 1.00 mil bbl June-loading Nile Blend via its sell tender closed on Thursday. The buyer was a Chinese end-user and the price was said to be at flat to a discount of 20cts to DTD Brent. Regarding May-loading Nile Blend, Malaysia state-run Petronas earlier sold a cargo to a Chinese end-user at a discount of low-$7s to DTD Brent in second-half April as reported. The Nile Blend values rose sharply by around $7.00 from the previous month.

Asia/Pacific

Spot differentials for June-loading Malaysian Labuan were assessed at premiums in the range of $1.65-1.75 over DTD Brent. The market shot up by a whopping $5.20 from the previous day and flipped into positive territory. The market was pushed higher as rapidly recovering prices for competing grades led by Sakhalin Sokol boosted a demand shift to Malaysian grades. Meanwhile, supply-demand fundamentals also tightened up as Malaysian flagship grade Kimanis would have only five cargoes available in July, tied to a supply cut deal by OPEC Plus. Malaysian state-owned Petronas sold July-loading Labuan in its tender closed on Thursday. Buyer details remained sketchy at this stage, but the cargo apparently fetched a premium of $1.50-1.90 over DTD Brent.