Crude/Condensate: Sep 30-Oct 4: Van Gogh premiums jump on IMO demand
For Abu Dhabi crudes, the September-loading OSP for Murban was unveiled at a premium of $4.08 over Dubai quotes, up 89cts from the previous month. Meanwhile, the November-loading OSP formula for Saudi Arabian Arab Extra Light (AEL) was set at a premium of $3.60 over the Dubai/Oman average, up 70cts on month. The OSP gap between Murban and AEL widened to 48cts in favor of Murban. Meanwhile, the light/heavy gap for Saudi Arabian crudes grew marginally from the previous month. The price trends reflected an outlook that heavy sour grades with high yields of high-sulfur fuel oil would attract less demand ahead of the tighter sulfur regulation in bunker fuel starting January 2020.
Among Brazilian crudes, the country's state-run Petrobras sold Lula to China's Hontop Energy for December arrival. The cargo fetched a premium of the high $6 level over ICE Brent on a DES basis. Petrobras also sold Iracema and Buzios to China for December arrival. Chinese end-users beefed up crude oil purchases in recent weeks, in a bid to use up their crude oil import quotas for 2019.
With regards to Australian crudes, the country's producer Santos sold Van Gogh for mid-November loading. The cargo fetched a premium of around $13 over DTD Brent. The price was pushed higher by increasing demand as fuel oil blending stocks ahead of the tighter sulfur cap regulations starting January 2020. In condensate-related news, Vietnam's state-run PV Oil issued a term sell tender on Hai Tach for January-June 2020 loading.