Singapore — Saudi Aramco's major buyers in Asia are receiving full allocations for Saudi crude oil loading in July, with some Japanese refiners even getting higher volumes, according to market sources.
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Traders at several key Asian end-users said their July nominations were met and they were not aware of cuts to any refiners in the region.
At least two traders with two Japanese refiners said they had received incremental volumes, with one even getting "slightly more Arab Extra Light."
A Singapore-based crude trader with a North Asian refiner said that there were some adjustments to the allocation but "overall, the volume was the same."
Earlier this month, Aramco raised the July official selling price of its Asian-bound crudes by 35-95 cents/b. The adjustments were higher than market expectations with some traders saying that the increases were too high.
The increases could indicate that Aramco was expecting strong summer seasonal demand from Asia, especially for the medium, heavy crudes, traders said.
July OSPs were high and this was probably why Saudi Aramco was ready to allocate Asian buyers their nominated volumes, an East Asian crude trader said.
The full allocations to Asia buyers comes despite OPEC and 10 non-OPEC producers extending oil production cuts by nine months, a move that would keep nearly 1.8 million b/d of crude oil off the market through March 2018.
The country was allocated a quota of 10.058 million b/d under the agreement and has consistently produced less than its quota for five months in a row, the only country to do so.
Saudi Arabia's crude oil production averaged 10.03 million b/d in May, up from 9.98 million b/d in April, according to EIA data released last week.
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