Asian crude mart stable on RI allocations

Asian crude mart stable on RI allocations

SINGAPORE (Reuters): The heavy Asian crude market was steady
on Wednesday, as the final heavy sweet allocations from Indonesia
was revealed to be much higher than earlier expected, traders
said.

Indonesia allocated 30,000 barrels-per-day (bpd) of Minas,
11,000 bpd of Widuri and 4,000 bpd of Cinta.

This is in contrast to the 7,000 bpd of Minas and no Widuri or
Cinta that the market had expected to be allocated.

"There's no shortage of Minas barrels now," said a Japanese
trader.

Traders said that although the heavy sweet market was not
weak, the higher than expected Minas export allocations would
ease the tight market, keeping fundamentals balanced.

But spot trading was limited, most shoshas and affiliates have
committed their barrels to term buyers, leaving only equity
producers with small volumes of surplus barrels to sell.

Traders said that with the market balanced, January spot
prices of heavy crudes would be driven by how much requirements
China and Australia come up with.

But they added that Chinese demand so far has been lower than
earlier predicted, and expected that Minas premiums would remain
stable at 80 cents over the ICP or fall slightly.

"We had expected big Chinese demand before the Lunar New
Year," said a Japanese trader. "But it is not so big right now,
so that is a slightly bearish factor."

Some traders said that China has bought several cargoes of
heavy Vietnamese Bach Ho crude, but was not actively looking for
Indonesian heavy grades.

Vietnam's state Petechim awarded its February loading Bach Ho
tender to a Chinese trader at 11 cents per barrel over the OSP.

There was no activity on the Middle East crude market as many
traders were already away for Christmas.

Talk of a February Qatar Marine done at a discount of 30 cents
to QGPC could not be confirmed, and was thought by some traders
to be too low.