USGC sour crude exports see strong demand in Asia, India on wide Dubai/LOOP Sour spread: In the LOOP

The arbitrage for US Gulf Coast medium sour crudes to make the 30- to 45-day journey to Asia and India remains strong, with the LOOP Sour-Dubai spread at its widest level since October 12.

Dubai M2 reached a premium of $2.36/b to LOOP Sour crude on Monday morning, having widened 83 cents/b week on week. LOOP Sour and other WTI-based domestic medium sour crudes compete against Dubai-based grades from the Middle East in markets in Asia and India.

More than 11.94 million barrels of USGC crude and dirty products are set to arrive in China and North Korea in November, according to Platts trade-flow software cFlow. In October, one cargo of 1.054 million barrels of USGC sour crude arrived in South Korea.

Fixtures reports for the week ended October 27 show a cargo of crude moving from the USGC to Asia.

India imported 2.69 million barrels of USGC crude and other dirty products in October, with an additional 1.113 million barrels currently en route to Jamnagar, according to cFlow data. State-run Indian Oil Corp. imported its first contracted cargo of US crude at the start of October, followed by its second towards the end of the month.

Fixtures reports for the week ended October 27 show two cargoes of crude moving from the Caribbean to Jamnagar, India. The Caribbean often serves as a blending and storage hub for co-loaded barrels of USGC crude. Singapore has also emerged as a major importer of USGC crude and dirty products, taking in 5.528 million barrels in October, with an additional 1.91 million barrels set to arrive in November, according to cFlow data.

Fixtures reports for the week ended October 27 show two cargoes of crude moving from the US to Singapore and two cargoes moving from the Caribbean to Singapore. An additional cargo has been fixed to move from the USGC to either Singapore or China.

Currently, Louisiana-delivered crudes must be exported out of the Nustar and Plains terminals in nearby St. James. However, the Louisiana Offshore Oil Port is expected to begin allowing exports from its facilities in a few months, market participants said. This would involve moving crude along the 19-mile import line that will become bidirectional. LOOP has not provided an update on this since announcing it was exploring crude export options in late July.

The 'In the LOOP' Americas crude oil wrap runs each Monday in Crude Oil Marketwire, North American Crude and Products Scan and on the Platts Global Alert. You can read the FAQ: USGC LOOP Sour crude here and find the full special report LOOP Sour Crude: A benchmark for the future here. Also be sure to download our LOOP app by searching for 'Platts LOOP' in your app store.