SINGAPORE- Middle East crude benchmarks eased on Thursday as trade for November-loading cargoes slowed, while Russian ESPO premium hit its highest in four years on robust China demand.
For a third day, Total offered Murban crude for loading between Oct. 15 and Nov. 15 from China's Yangpu oil storage.
It reduced its offer for Murban loading from China's Yangpu oil storage to 85 cents a barrel above the November official selling price (OSP) on Thursday, down from $1 in the previous session.
Traders said the Murban offer has become attractive as it is cheaper than Russian ESPO crude which has seen a big jump in spot premiums.
Still, Chinese buyers typically prefer ESPO rather than Murban, and it remains to be seen if they will start switching grades.
RUSSIA: Spot premiums for ESPO Blend crude oil have hit their highest in more than four years, buoyed by a jump in Chinese demand, trade sources said.
Producers Surgutneftegaz and Gazprom Neft have sold three cargoes loading in the first week of November at premiums of $5 to $6 a barrel to Dubai quotes, the sources said, up to $2 higher than deals the month before.
The premiums are the highest since 2014 and have overtaken those for better-quality Russian grade Sokol, according to the sources and Reuters data.
Surgut on Tuesday sold a cargo for loading on Oct. 31-Nov. 5 at a premium of about $4.90 a barrel to Dubai quotes, the sources said.
On Wednesday, Gazprom Neft sold a cargo at $5.40-$5.50 a barrel above Dubai quotes, while Surgutneftegaz sold a second cargo loading on Nov. 3-8 at a premium close to $6 a barrel, the sources said.
Argus launched on Wednesday three new price assessments for crude delivered to China's Shandong province, where the bulk of the country's independent refiners are located.
The price quotes are for Russian ESPO Blend, Brazilian Lula and Congolese Djeno crude delivered to ports around Qingdao city, Argus said in a statement on its website.
S&P Global Platts has moved closer to revamping its dated Brent benchmark, launching new price assessments for two grades of U.S. crude in Europe in response to the swell of imports into the region.
Platts, which publishes the daily Brent benchmark price that underpins two-thirds of the world's oil trades, said it would provide daily price assessments for West Texas Intermediate Midland and Eagle Ford 45, both light, sweet crudes for delivery to Rotterdam in northwest Europe and Augusta in the Mediterranean.
REFINERY
India's Chennai Petroleum will stop processing Iranian crude oil from October to keep its insurance coverage once new sanctions by the United States against Iran go into effect, three sources familiar with the issue said.
NEWS
Russian oil producer Surgutneftegaz is pushing buyers to agree to pay for oil in euros instead of dollars if the need arises, apparently as insurance against possible tougher U.S. sanctions, traders who deal with the firm told Reuters.
Energy trade with China will remain strong in the long term, officials said on Wednesday at a Sino-U.S. oil and gas forum in Houston, even as an escalating trade dispute hits U.S. exports of natural gas.
Japanese oil refiners have temporarily halted Iranian oil loadings ahead of U.S. sanctions and are buying alternatives as it remains unclear whether Japan will receive an exemption, the head of the country's refinery association said.
Global banks and trading firms are launching the first blockchain-based platform for financing the trading of commodities from oil to wheat, they said in a joint statement.
Woodside Petroleum Ltd will load its last Enfield crude oil cargo in November as the Australian field reaches the end of production, a company spokeswoman said.
(Reporting by Florence Tan, Editing by Sherry Jacob-Phillips) ((Florence.Tan@thomsonreuters.com; +65 6870 3497; Reuters Messaging: florence.tan.thomsonreuters.com@reuters.net)) ))
