MOSCOW (MRC) -- South Korea is on track to overtake Canada as the top buyer of U.S. crude oil in 2020 as a mix of steep price discounts to alternative supplies, attractive refining economics and rebates on shipping charges prove too good to resist for big refiners, said Hydrocarbonprocessing.
South Korean purchases more than doubled in the first 11 months of 2019 from a year earlier to 142.3 million barrels, Energy Information Agency (EIA) data showed. That was by far the fastest growth rate among top destinations for U.S. crude, and placed South Korea less than 10 million barrels behind top market Canada.
With the United States set to become a net exporter of crude for the first time in 2020, Asia is expected to be a focus for more shipments, especially as European refiners have limited capacity for more shale. Historically attractive pricing has been a key driver behind U.S. export momentum.
South Korea, the world’s fifth-biggest oil importer, bought more than 375,000 barrels per day (bpd) of U.S. oil in 2019, taking its share of Korean imports to nearly 13%. Buyers paid on average $1.70 a barrel less than for crude from top supplier, Saudi Arabia, according to Reuters calculations based on state-run Korea National Oil Corp (KNOC) data.
This compares with a 97 cents a barrel premium in 2018. “It is economically more attractive, and trade companies, midstream (firms) and producers have been aggressive seeking out buyers for American crude in Asia,” said Stephen Wolfe, a Houston-based oil analyst at Energy Aspects.
"Light sweet (crude) is attractive in Korea as a substitute for Iranian South Pars, especially in petrochemically-integrated plants, and especially after the implementation of IMO 2020 (ship fuel rules).”
U.S. crude oil is normally more expensive for Asian buyers than Middle East grades due to longer journey times and the fact that it yields more quality fuels at a lower refining cost.
Light sweet crude contains more naphtha, used in petrochemicals, and also has a lower sulphur content, making it suitable for very low sulphur fuel oil, which has been mandated for shipping since the start of 2020.
As MRC wrote before, Russian dealers of Hyundai sold 178,809 cars in 2019, which corresponds to the level a year earlier. As a result, Hyundai ranked fourth in sales among all automakers in Russia, and the brand’s market share was 10.2% versus 9.9% a year earlier, according to AEB.
In September 2010 Hyundai Motor Company launched a plant in St. Petersburg (Hyundai Motor Manufacturing Rus). Currently, the factory produces Hyundai Solaris and Kia Rio models. The Hyundai plant accounts for the bulk of cars produced in St. Petersburg. Hyundai Motor's Russian plant operates on a full production cycle. Creating a car begins with stamping body panels from steel coils. The welding process is fully automated. All paintwork both outside and inside the body is applied by robots.
Polypropylene (PP) is one of the main feedstock materials for the production of interior parts of the car.
According to MRC's ScanPlast report, the estimated PP consumption in the Russian market was 1,260,400 tonnes in January-December 2019, up by 4% year on year. Supply of almost all grades of propylene polymers increased, except for statistical copolymers of propylene (PP random copolymers).
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