Aramco’s Discounts Attract Customers In Europe

A decrease in demand in the oil market in the context of the coronavirus pandemic attracted many buyers to Saudi oil, which was delivered to the region in April with big discounts, the news agency Argus reported.

« In North-Western Europe… Saudi Aramco set the contract price for the April lots of the Arab Light at a discount of $ 10.25 per barrel (delivered on FOB terms) to Brent, while in March a discount of the grade in the region was only $ 2.25 per barrel, » the agency writes.

The material, citing data from the Vortexa analytical system, indicates that many refineries were attracted to such conditions. So, Shell, Total, OMV, Repsol and Cepsa increased purchases of Aramco oil. “Shipments of Saudi oil to the Netherlands, where large oil storage facilities are located, could reach about 1.42 million tons in April, which is double the March level. During this period, the total volume of Urals shipments, by contrast, will decrease by 41%, to less than 935 thousand tons.”, – the agency writes with reference to Vortexa data.

Poland increased its export of Saudi oil, too. In April, almost 500 thousand tons of oil from the kingdom should arrive at the port of Gdansk, compared to 398 thousand in March. At the same time, in early April, only one batch of Urals for 66.5 thousand tons, purchased back in March, arrived in Gdansk. Last month, Poland received five Urals shipments totaling almost 377 thousand tons.

“However, the bulk of Russian oil will continue to be pumped to Poland through the Druzhba pipeline as part of long-term contracts,” the report says. But at the same time it is indicated that not a single batch of Urals will arrive in Turkey in April for the first time since May 2018, while the Turkish processor Tupras decided to purchase one cargo of Arab Light.

source: argusmedia.com

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