Thai Oil buys first crude cargoes from Oman, US amid OPEC cuts

MOSCOW (MRC) -- Thailand's largest oil refiner Thai Oil has bought its first ever cargoes of US Eagle Ford crude and Oman crude as its diversifies purchases amid OPEC production cuts, two sources with knowledge of the matter said on Friday, reported Reuters.

The company bought 500,000 barrels of Eagle Ford crude from a western trader for delivery at the end of May and an equal volume of Oman which will load in May. It bought the cargoes after oil prices fell on lower demand in Asia during peak refinery maintenance season in the second quarter.

Thai Oil has previously purchased the West Texas Intermediate (WTI) crude grade from US for its refinery, paving the way for this purchase, one of the sources said.

"The company has processed US WTI Midland before and had no problem. So this time it is trying out another US crude," the source said.

The purchase of these grades comes a month after Thai Oil bought its first ever Russian Sakhalin Blend crude cargo.

Thai Oil officials declined to comment.

The refiner typically buys Abu Dhabi crude from the United Arab Emirates (UAE) in the spot market to meet incremental demand at its plant. The UAE is part of the Organization of the Petroleum Exporting Countries (OPEC) that has cut output since January to support oil prices.

We remind that, as MRC informed before, Russia will not fully scrap its oil export duty until 2022-2025, Finance Minister Anton Siluanov said in mid-March 2017, four years later than previously expected. Russia, the world's biggest oil producer, is in the midst of a so-called "tax manoeuvre" whereby it is gradually increasing its mineral extraction tax (MET), while at the same time cutting export duties on oil and refined products. Previously the finance ministry had considered cutting the oil export duty to zero between 2018 and 2020.
MRC

MOSCOW (MRC) -- Integrated Refinery and Petrochemical Complex (IRPC), a PTT Plc subsidiary, is likely to restart its naphtha cracker following a maintenance turnaround, as per Apic-online.

A Polymerupdate source in Thailand informed that the company has planned to resume operations at the cracker early this week. The cracker was shut for maintenance on February 3, 2017.

Located at Map Ta Phut in Thailand, the cracker has an ethylene capacity of 360,000 mt/year and propylene capacity of 312,000 mt/year.

As MRC informed before, IRPC shut its PP plant in Rayong province with the capacity of 300,000 mt/year in January 2017 for 10 days to conduct a maintenance turnaround.

PTT Global Chemical is a leading player in the petrochemical industry and owns several petrochemical facilities with a combined capacity of 8.45 million tonnes a year.
MRC

MOSCOW (MRC) -- Saudi Arabia's crude exports to the United States in March will fall by around 300,000 bpd from February, in line with OPEC's agreement to reduce supply, a Saudi energy ministry official said on Thursday, said Reuters.

The United States imported about 1.3 MMbpd from OPEC's top exporter in February, according to US Energy Information Administration data. "Exports may fluctuate week on week, but on average in March exports will be down," the official said, responding to a Reuters request to comment on the EIA data. Saudi exports are then expected to remain around March's level for the next few months, the official said.

The official noted that export data showed higher Saudi oil exports in January and February, but these shipments were the result of cargo loaded in November and December.

Saudi Arabia has made the largest cut in production after the agreement reached last year by both the Organization of the Petroleum Exporting Countries and non-OPEC producers to reduce output by 1.8 MMbpd.

Oil prices have been in a downtrend for two weeks on concerns that OPEC cuts so far have not dented record US crude inventories. US crude has declined nearly 10% since March 7 as speculators reduced big bets that oil would keep rising. It settled on USD47.70 on Thursday.

Crude stocks in the United States, the world's largest oil consumer, were a record 533 million barrels last week, the EIA said. In the week ended March 17, US imports from Saudi Arabia unexpectedly rose by more than 200,000 bpd to 1.28 MMbpd, after a sharp decline the prior week.

"This is mainly because there is a refinery maintenance in the US The cuts in exports will help the crude stockpiling in the US to go down," the official said. Gasoline stocks are falling, but remain seasonally high.

The official also said he believed other Gulf oil exporters will follow suit and their crude exports will be lower in March and will continue to decline. Imports from Iraq and Kuwait dropped sharply for the week to March 10 but then rebounded in the most recent week of data.
MRC

MOSCOW (MRC) -- Vitol's annual traded volumes rose 16% in 2016 to a new record as the world's largest independent energy trader sold more gasoline and diesel in markets such as the United States and Australia, said Reuters.

The Swiss-based company said on Friday its crude oil and product trading rose to 2,597 million barrels last year, or more than 7 MMbpd.

Crude represented 48% of its traded portfolio and volumes also rose 16%. The biggest jump in percentage terms came from gasoline, up 44% and gasoil, up 26%, driven by increasing demand in the United States, Australia and Vitol's growing presence in key African markets.

Vitol's turnover, however, fell to USD152 billion in 2016 from USD168 billion in 2015 as a result of lower energy prices.

"(Global) demand growth of 1.4 million barrels a day exceeded our expectations slightly, but the continued efficiency gains within the exploration and extraction sector ensured the market was well supplied and the impact on price constrained," Vitol said.

The firm also said oil prices in 2016 were no longer in the steep contango market structure that boosted results in 2015. Contango is a market structure in which the price for delivery of a product in the future is higher than the immediate price.

Vitol also said growth in the supply of liquefied petroleum gas (LPG) from US shale was creating new opportunities.

"Our 2016 volumes increased by 131% and, longer term, we anticipate that the ample supply of LPG will facilitate the switch away from solid fuels for cooking in economies across Africa and Asia," it said.

"In addition, we are working with power plants and light industry in Africa to help them move from burning fuel oil and diesel to LPG, a cleaner and more efficient source of fuel."
MRC

MOSCOW (MRC) -- There was a process upset Tuesday at Total Petrochemicals and Refining USA's 1,224,700 mt/year polypropylene (PP) plant in La Porte, Texas, the company said in a regulatory filing, as per Plastemart.

The plant's Train 9 production unit flared on Tuesday for about three hours, according to the filing to the Texas Commission on Environmental Quality.

As MRC reported earlier, Total's proposed new ethane cracker near its refinery in Port Arthur, Texas, is being designed to have a capacity of 1 million tpy, the company said in a permit application to the Texas Commission on Environmental Quality (TCEQ) in 2015. Construction on the cracker was to start in June 2016, with operations starting three years later. The project would include seven ethane-cracking heaters. Total first mentioned the possible project in May 2013 and is currently looking for partners who could have ownership stakes and help with plant operations.

Total S.A. is a French multinational oil and gas company and one of the six "Supermajor" oil companies in the world with business in Europe, the United States, the Middle East and Asia. The company's petrochemical products cover two main groups: base chemicals and the consumer polymers (polyethylene, polypropylene and polystyrene) that are derived from them.
MRC