Russia set to cut base oil exports to China and beef up supplies to Europe in the fourth quarter in view of strong demand and higher export margins in Europe, an international trader revealed.
The volume would be pegged at only around 10,000mt per month in the last quarter, a domestic trader said. This was far lower than the maximum record of 25,000-30,000mt/month from Russia, reckoned the trading source.
Most of the suppliers would come from Angarsk Refinery, which was closer to China than to Europe, pointed out the source.
However, two of Russia's other major base oil suppliers, LukOil and Omsk Refinery, were expected to send few resources to China, as their offers were US$50-60/mt higher than the acceptability of most Chinese importers, the trader said. Moreover, they had reduced base oil exports to China and transferred resources to Europe since the beginning of the second half year, when prices kept hovering higher there, according to him.
Most Chinese buyers showed keen importing interests in cargoes from Angarsk Refinery, thanks to limited supplies of homemade resources amid heavy maintenance in November and December, pointed out an industry source. The Russian refinery, consequently hiked Group I prices to US$900-980/mt on DAF Erenhot basis, highest within the year, according to him.
Due to supply shortfall of homemade resources and mounting import costs, most domestic traders might subsequently hike domestic prices, and Group I base oil prices might hit above Yuan 9,000/mt.
The volume would be pegged at only around 10,000mt per month in the last quarter, a domestic trader said. This was far lower than the maximum record of 25,000-30,000mt/month from Russia, reckoned the trading source.
Most of the suppliers would come from Angarsk Refinery, which was closer to China than to Europe, pointed out the source.
However, two of Russia's other major base oil suppliers, LukOil and Omsk Refinery, were expected to send few resources to China, as their offers were US$50-60/mt higher than the acceptability of most Chinese importers, the trader said. Moreover, they had reduced base oil exports to China and transferred resources to Europe since the beginning of the second half year, when prices kept hovering higher there, according to him.
Most Chinese buyers showed keen importing interests in cargoes from Angarsk Refinery, thanks to limited supplies of homemade resources amid heavy maintenance in November and December, pointed out an industry source. The Russian refinery, consequently hiked Group I prices to US$900-980/mt on DAF Erenhot basis, highest within the year, according to him.
Due to supply shortfall of homemade resources and mounting import costs, most domestic traders might subsequently hike domestic prices, and Group I base oil prices might hit above Yuan 9,000/mt.
