By December 9, 2016 Read More →

PetroChina, Unipec to ship more than 2 million barrels US crude in Dec

US crude

Traders took advantage of an arbitrage between cheaper US WTI and Brent along with low freight rates to stock up on US crude. photo.

US crude production should increase if OPEC deal goes through

Dec 9 (Reuters) – Chinese state-owned oil traders PetroChina and Unipec have chartered ships to load more than 2 million barrels of US crude oil in December, three sources with knowledge of the matter said on Friday.

The shipments come on top of nearly 3 million barrels that BP has sent to Asia as oil traders sell growing supplies of cheap U.S. shale oil to the region of the world that consumes the most crude.

Analysts expect US shale production to increase next year after an agreement by the Organization of the Petroleum Exporting Countries and Russia to cut output from January lifted oil prices.

Traders took advantage of an arbitrage between cheaper U.S. West Texas Intermediate (WTI) crude and the global benchmark Brent and low freight rates.

A narrowing of the spread between Brent and Middle East Dubai crude to the smallest in a year also made U.S. oil more competitive than similar Middle East grades.

PetroChina has chartered Suezmax London Spirit, which loaded some crude in the Galveston Offshore Lightering Area (GOLA), Texas, earlier this month, according to the sources and shipping data on Thomson Reuters Eikon.

Unipec, the trading arm of Asia’s largest refiner Sinopec , is expected to load 2 million barrels of US crude onto very large crude carrier (VLCC) Xin Han Yang next week, one of the sources said.

It will be Unipec’s second shipment of US crude in three months. In October, the company loaded oil on VLCC Overseas Rosalyn which is expected to reach the southern Chinese port of Zhanjiang on Dec 31.

(Reporting by Chen Aizhu in Beijing, Catherine Ngai in New York, Florence Tan in Singapore and Osamu Tsukimori in Tokyo; editing by David Clarke)

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