Russia's Asian crude export price hit by higher supply, sanctions -trade

Пятница, 18 июля 2014 13:24 MSK

* Asia to get 2-3 more ESPO cargoes a month after Russian refinery fire

* Abundant crude supply, weak refining margins weigh on ESPO premiums

* Buyers cautious after tougher U.S. sanctions on Rosneft

By Florence Tan and Jacob Gronholt-Pedersen

SINGAPORE, July 18 (Reuters) - Russia is offering more crude oil for exports to Asian markets after a fire at a refinery near its Pacific coast, though the higher supply and nervousness about the impact of tougher sanctions on Moscow over Ukraine is weighing on prices.

Additional Russian supply will give Asian refiners more options on their crude mixes, intensifying competition with rival Middle East grades, at a time when they are already processing less oil amid low profits and slow seasonal demand.

Fresh U.S. sanctions against Russian companies this week could also prompt some buyers to shy away from the grade and put pressure on the main marketer of Eastern Siberian-Pacific Ocean (ESPO) oil, Rosneft, to lower prices, traders said.

"People who want to buy ESPO may go to other suppliers, and Rosneft might struggle to find buyers for their cargoes," said a trader with a refinery in North Asia. Other sellers of the grade include Surgutneftegas, Gazprom Neft and Lukoil.

"We will try not to touch if possible, as we need to observe the situation carefully," the trader said.   Продолжение...