A recent drop in Brent crude oil futures prices may encourage China to take more barrels of Russian Urals and African grades, traders said on Friday. Traders said China's Unipec has bought 2 million barrels of April loading Russian Urals. The purchase might have been a part of a term contract with a Russian trader, but details were not available. "Brent prices have eased, so China may take more Urals and West African barrels," a Tokyo-based trader said. China is a major lifter of such grades in Asia.
Prompt Brent crude oil for May delivery settled on Thursday at $53.93 a barrel, about 4 percent lower than the record high of $56.15 struck on March 17.
Brent premium over Middle East benchmark Dubai crude, or Brent/Dubai Exchange for Swaps (EFS), was notionally assessed at $6.70/$6.80 a barrel for May, steady from Thursday.
But the numbers were much narrower than around $7.50 earlier this week.
Lower Brent prices and narrower EFS numbers make Atlantic Basin crude, including Urals and West African, more affordable to Asian buyers as such grades are priced off Brent.
On the Middle East market, a Japanese trader sold a May-lifting cargo of Murban to a Japanese refiner at a premium of 80 cents a barrel to its official selling price (OSP) set by the Abu Dhabi National Oil Co (ADNOC), the price level was lower than the previous deals done at around $1 a barrel.
Traders also said May-lifting and June-lifting Murban barrels were sold to Thailand at premiums of 70 cents and 60 cents, respectively.
Both deals were for smaller lots. May lifting Oman was assessed steady at a premium of 15/20 cents to its OSP set by the Ministry of Oil and Gas (MOG).