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.