Middle East Crude

　In the trade of Iranian trade for Asia, Chinese companies continued to buy spot cargoes. Many independent oil refiners in China's Shandong province purchased Iranian Light (IL) and Iranian Heavy (JH) from state-owned National Iranian Oil Co (NIOC) and several traders in September. The US government imposed its second sanction on countries that purchased Iranian grades, but many Chinese companies continued to buy spot cargoes of Iranian grades, regarding prices as undervalued, compared with arbitrage cargoes such as West Africa and US. For Iranian grades bound for China, sellers often supply cargoes via VLCC tankers and China's monthly imports for IL and IH totaled about 20 VLCCs. "Among Iranian cargoes for China, there are re-exported cargoes that were once discharged in other countries such as Malaysia and Indonesia," said a Chinese company.

African/European/Russian/American Crude

　The CFR The CFR Northeast Asia market of WTI Midland for November arrival edged higher due to a rise in freight rates. Tradable levels for WTI Midland for November to December arrival in Northeast Asia were heard at premiums in the mid-high $3's to Dubai quotes. Nevertheless, the value of WTI Midland remained attractive compared with Abu Dhabi Murban, a rival grade despite a rise in the market for WTI Midland.

In trade for December arrival, some end-users in Japana and Korea continued spot purchase of US light grades such as WTI Midland. GS Caltex bought 2mil barrels of WTI Midland for December arrival from US Chevron this week. The price was said to have been at premiums in the mid-high $3's to Dubai quotes. In addition, Cosmo Oil in late August purchased 2mil barrels of WTI Midland for December arrival.

Asia Pacific Crude

　In trade for October-loading Vietnamese grades, state-owned PetroVietnam Oil (PV OIL) had awarded a SV-DN sell tender to Hengyi Petrochemical. It later turned out that the awarded price was at premiums in the low 3's to Dated Brent. Hengyi Petrochemical was likely to deliver the cargo of SV-DN to its refinery in Pulau Muara Besar, Brunei. Through the tender closed on August 19 with validity until August 20, PV OIL was trying to sell one 300,000bbl cargo for Oct 6-12 loading.