Asian heavy crude prices steady

Asian heavy crude prices steady

SINGAPORE (Reuters): Asia's heavy crude prices were steady yesterday as pending Indonesian export allocations for August kept trading limited.

Traders said that heavy Indonesian crudes such as Minas and Widuri were talked at firm premiums of 50/55 cents per barrel to ICP, in line with the last cargoes traded, but no new deals were reported done.

Indonesian state oil company Pertamina is due to announce its August export allocations later this week.

Traders said that light sweet Malaysian Tapis crude was offered at a premium of 20 cents to APPI quotes, stable from July.

They said an August Bach Ho was also heard to have been done between two Japanese traders, but this could be and old trade, prior to a partial cargo purchase that a U.S. major made late last week.

Heavier regional crudes were befitting from hot weather and expectations of a boost in utilities' demand for direct burning crude to produce power.

But middle distillate-rich crudes such as Tapis were under some pressure, as Asian demand for gas oil faltered, and kerosene buying goes into a seasonal lull, traders said.

In the Middle East crude market, August Oman was assessed at MPM -2 cents per barrel, unchanged from previous trades done.

Saudi Arabia has told its Japanese and South Korean buyers that August term liftings would be cut by 8 to 9 percent on average.

This was a larger cut than was implemented in July. In July, cuts in term sales to Japan averaged 6-7 percent, while reductions in South Korean sales were around 4.5 percent, although actual cuts to each buyer differed depending on the term volumes and types of grade lifted.

European buyers have also been told by Saudi Arabia of an 8 to 9 percent cut in August crude liftings.

Traders said Abu Dhabi had told customers of August term reductions.

Qatar had earlier told customers that term lifting cuts effective in July, would last until the end of the year. Oman had informed buyers that its July reductions would continue until further notice.

They said that Iran had also told buyers of a 10 percent cut in its export volumes, but again lifters were unclear how much of their actual term liftings would be affected.

For July, traders said that Iran had asked South Korea's Hyundai refinery and some Japanese refiners to defer July lifting cargoes to August.