Platts corrects Nov. 29 Mediterranean sweet and Mediterranean sour crude commentaries

Platts, part of S&P Global Commodity Insights, has corrected the Nov. 29 Mediterranean & Black Sea sweet crude and Mediterranean Sour crude commentaries.

The Mediterranean & Black Sea sweet commentary should read as follows:

**Azeri sees support from diesel cracks

**CPC Blend facility repairs completed

Buying interest for many grades remained subdued in the Mediterranean sweet crude market Nov. 29, while Azeri Light continued to see some support from strong diesel cracks.

"Saharan has not traded very actively," one trader said, adding that values were at discounts to Dated Brent.

While the trades that were occurring were typically straight to the end-user, market participants continue to see Azeri differentials supported.

"I believe that the diesel cracks definitely favor Azeri," the trader said.

In addition to the freight rates keeping pressure on FOB differentials, the volume of light sweet crude arriving into Europe from West Africa and the US has resulted in significant competition.

US crude oil inventory draws likely extended in the week ended Nov. 25, analysts surveyed by S&P Global Commodity Insights said Nov. 28, as refinery demand was expected to reach three-month highs.

US commercial crude stocks likely declined 4.4 million barrels over the period to around 427.3 million barrels, analysts said, the lowest since the week that ended Sept. 2.

Looking elsewhere in the sweet complex, the Caspian Pipeline Consortium, which handles almost 1.5 million b/d of Caspian crude, has completed repairs to the second of two loading systems that needed attention, restoring full capacity at the Russian facilities relied on by Kazakhstan for its oil exports, the consortium said Nov. 29.

In a statement, the Moscow-based multinational consortium said a buoyancy tank used to hold in place subsea hoses at Single Point Mooring System No. 2 had been replaced and testing completed.

On the paper side, market participants said that while limited trading activity was occurring, the majority of the indications were on the offer side as paper markets start to feel the pressure of physical market length.

"All we have seen is that it is offered really," a second trader said, referring to CPC CFDs.

The Mediterranean Sour Crude Daily Analysis should read as follows:

**Chinese demand concerns further pressure sentiment

**Sour market length remains in Europe

In the European sour crude market Nov. 29, traders expressed concern around falling demand from China.

"Mobility came off sharply. It is really bad for Chinese demand," one trader said, adding that would be unlikely to change in the short term.

While Russian Urals had previously been receiving strong demand as a result of heavily discounted differentials, market participants said the fundamentals of falling Chinese buying interest were starting to grip.

"I think the REBCO arbitrage East [is for the] first time feeling the real pressure from all other physical grades," the trader said.

Buyers of the grade were in wait-and-see mode ahead of the Dec. 5 embargo and the announcement of the price cap, traders said.

China and Russia were looking to further increase energy cooperation at a time when sanctions have drastically reduced Russia's energy links with the West, participants at the Russia-China Energy Business Forum said.

Mixed sentiment has surrounded KEBCO (Kazakh-origin Urals) crude oil in recent days with some traders suggesting the market length and high freight rates would pressure differentials, while others have said differentials were at single-digit discounts to Dated Brent on a CIF Augusta basis.

Sour crudes elsewhere in the region were also struggling to find homes.

"Johan [Sverdrup] still cannot find a floor," the trader said, referring to the North Sea grade, with traders indicating value for the grade was below a $6/b discount to Dated Brent.

The Mediterranean & Black Sea sweet commentary is published on PGA page 1295, PCR page 1295 and in the Platts Crude Oil Marketwire.

The Mediterranean Sour Crude Daily Analysis is published on PGA page 1296, PCR page 1296 and in the Platts Crude Oil Marketwire.