Minas differentials weaken further

Minas differentials weaken further

SINGAPORE (Reuter): The Minas crude oil discount to the Indonesian Contract Price (ICP) appeared to be slipping further yesterday, traders said.

A trader was said to have sold 200,000 barrels of Minas crude to China at a fixed price of US$18.80 per barrel.

Traders said this equated to a discount of to 70 cents. The last deals done were at a discount of 23 cents.

Traders said China was now bidding at a fixed price $18.30 per barrel for August Minas barrels.

Some traders said the $18.80 fixed price deal reflected pressure to push down published Minas assessments.

Many price assessments have remained above $19.00 per barrel despite the weakening differential.

But some traders said pressure to push the Minas outright values lower would run counter to currently buoyant Brent and NYMEX markets, which were offering support.

September Brent rose seven cents in London on Tuesday, adding to Monday's 73 cent rise. September settled at $20.74 per barrel and was quoted in Singapore on SIMEX at $20.72 to $20.80.

September NYMEX rose 15 cents on Tuesday, to add to Monday's 65 cents rise, taking the contract to $22.37.

But traders said a Minas arbitrage into the U.S. west coast was still closed. One trader said the NYMEX October or November contracts needed to be $3.50 higher than Minas for the economics to work.