Middle East

Saudi Arabia's state-owned Saudi Aramco agreed to renew the lease contract of crude storage tanks in Okinawa owned by Japan Oil, Gas and Metals National Corp (JOGMEC) from October 2019 onwards. Saudi Aramco brings its own-produced crude oil to Okinawa, utilizing the tanks as a hub to store and supply crude oil to East Asia for commercial purposes. But in case of emergency, Saudi Aramco prioritizes suppling crude oil to Japan with an aim to reinforce energy security in Japan.

Africa/Europe/Russia/America

For Far East crudes, ESPO was gripped by mixed sentiment with both bullish and bearish factors in sight. The Chinese government granted independent refiners in Shandong China with a combined 12.90 mil mt of crude oil import quotas as the third batch for 2019. The new import quotas would help boosting demand for ESPO. Meanwhile, ESPO with short distances to North East Asia lost price competitiveness following a plunge in long-hauled freight rates. A demand shift from Middle Eastern crude oil to ESPO was likely to slow down.

Asia Pacific

December-loading Malaysian light crudes led by Kimanis were generally weaker. Asian end-users found less price merits for short-distance voyages as a steep decline for long-hauled freight rates highlighted price attractiveness for US WTI Midlands. With regards to Vietnamese crudes and condensates, the country's state-owned PV Oil concluded its term sell tenders on Bach Ho Light and Hai Tach condensate for January-June 2020 loading.