Register with us today

and in less than 60 seconds continue your access to: Latest news headlines Analytical topics and features Commodities videos, podcast & blogs Sample market prices & data Special reports Subscriber notes & daily commodity email alerts

Already have an account?

Log in to register

Forgot Password

Enter your Email ID below and we will send you an email with your password.

  • Email Address* Please enter email address.

If you are a premium subscriber, we are unable to send you your password for security reasons. Please contact the Client Services team.

If you are a Platts Market Center subscriber (, Please navigate to Platts Market Center to reset your password.

In this list

Asian refiners hit by another round of Saudi crude term allocation cuts

Energy | Natural Gas | LNG | Oil | Refined Products

Interview: Satvinder Singh, Enterprise Singapore

Crude Oil

Platts Wellscape GIS

Oil | Crude Oil

Platts Workshop at the S&P Global Platts Energy


Seoul concerned about condensate supplies amid looming Iran sanctions

Asian refiners hit by another round of Saudi crude term allocation cuts


South Korean refiners receive 5%-10% Dec Saudi crude allocation cuts

India, Japan to receive less-than-expected Dec Saudi term barrels

Dec Saudi allocation cuts priced in as OSPs, Dubai structure rally

Singapore — At least four refining companies in Northeast and South Asia have received significant cuts in December term allocations for various Saudi Arabian crude oil grades, a move that further cements the major Persian Gulf producer's commitment to keep OPEC production limited and support prices, market sources said Tuesday.

Not registered?

Receive daily email alerts, subscriber notes & personalize your experience.

Register Now

Middle Eastern crude exportsThree South Korean refiners have recently been informed that the companies would receive 5%-10% less December Saudi term barrels than what they had initially requested for, trade sources based in Seoul and Singapore with knowledge of the matter told S&P Global Platts.

SK Energy, the country's biggest refiner, would receive 16,000 b/d less Saudi term barrels for loading in December, equivalent to a cut of around 10% in the monthly allocation, a Singapore-based trading source said.

The latest allocation cuts would mostly tighten December supply of Arab Extra Light and Arab Medium crude grades to South Korea, the sources added. Elsewhere, market sources in South Asia indicated that at least one state-run Indian refining company would receive allocation cuts of around 5%-6% for December-loading light and medium sour Saudi crude oil.

The sources declined to identify the Indian firms struck by the latest Saudi crude oil allocation cuts, but they said many South Asian end-users have been receiving less Saudi term volumes than their desired amount over the past several months.

In Japan, Saudi crude oil allocation cuts to Asia's third-largest energy consumer have also been ongoing, two trading managers at Japanese companies told Platts. Market talk indicated that term allocations of December-loading Arab Medium crude could have been trimmed, although full details of the reduction in December term volumes to Japanese refiners could not immediately be ascertained.

There were a few Asian refiners spared from any supply cuts, however, with Thailand's PTT receiving full allocation for its December Saudi crude oil term volumes, a source at the Southeast Asian firm said.

In China, some of the country's state-run refining companies including PetroChina, were said to have received close to full December term allocation volumes as well.


Saudi Arabia's latest term allocation cuts hardly surprised market participants as the move was in line with its fellow OPEC producer UAE's tight December crude export outlook, while the recent spike in Middle Eastern official selling price differentials had already hinted that supply would remain limited to Asia.

Late last month, UAE's Abu Dhabi National Oil Co. was quick to announce that the state-run company would cut its allocations for December-loading Murban crude to its customers by 15%, while those for Das Blend and Upper Zakum were reduced by 10% and 5%, respectively.

Regional sour crude traders noted that the latest round of Middle Eastern OSP hikes had also served as a precursor to another round of Saudi export cuts to Asian customers.

Earlier this month, Saudi Aramco raised the OSP differentials for its Asia bound crude grades for December by 65 cents/b for Arab Extra Light, Arab Light, Arab Medium and Arab Heavy, and raised Arab Super Light by 45 cents/b month on month.

For Arab Super Light, the December OSP differential was set at Platts Oman/Dubai average plus $4.55/b, the highest in a year, as the December 2016 OSP differential came in at exactly the same level.

ADNOC has also raised its retroactive OSPs for October loading crude, with the differentials relative to Dubai seeing a hike of 52 cents/b for the light Murban and Das Blend crude grades to premiums of $2.55/b and $2.20/b to Dubai respectively.

Reflecting the lofty monthly selling prices and tight supply into Asia, the Dubai physical crude market structure extended its uptrend, rallying to a fresh three-year high in recent weeks.

The spread between front-month cash Dubai and same-month Dubai swaps rallied to a premium of 89 cents/b on Wednesday last week, the highest since July 25, 2014 when the equivalent spread was assessed at 95 cents/b, Platts data showed.

"December supply is especially crucial because they will arrive [in Northeast Asia] by January, the peak winter [refiner] run rate season," said a Singapore-based sour crude trader, indicating that some Asian companies could bid strongly in the Middle Eastern spot market this month to cover their short positions.

-- Gawoon Philip Vahn,

-- Ada Taib,

-- Edited by Irene Tang,