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Mediterranean crude: More Iranian crude heads to Europe
Polish oil company Lotos confirmed its purchase of Iranian crude, joining several new buyers of the country's crude in Europe and the Mediterranean in recent months.
Grupa Lotos bought a 2mn bl cargo of medium sour Iranian Light aboard the VLCC Atlantas, in a "test shipment" which may be followed by more purchases. The vessel left Kharg Island on 27 June and is headed towards Gdansk. The crude will arrive at Gdansk in mid-August — although it may need to be transferred to smaller vessels in order to pass through the Danish straits.
Several new European buyers stepped in to buy Iranian crude in May and June, with some refiners preferring the "versatile" nature of the Iranian Heavy grade compared with alternatives, despite its premium over competing grades. Iran's NIOC is expected to follow state-owned Saudi-Aramco in making a cut to its official formula prices in the Mediterranean for August-loading cargoes, although some traders questioned whether it would be cut by the same amount. Iraqi state-oil marketer Somo is also yet to release its official prices.
A 1mn bl Iranian crude shipment also arrived at Cartagena on 2 July. Iranian crude landed in Spain in April and May at Algeciras, where Cepsa has a 240,000 b/d refinery.
Iraqi Basrah Light on a cif Augusta basis was most recently assessed at Dated –5.60, following Turkish refiner Tupras's reported purchase of a Suezmax of Basrah Light. Weaker demand for the grade has been counterbalanced by tighter supplies — given the shorter July loading programme. More Urals crude is also seen moving towards the Mediterranean region. Few cargoes of Basrah Heavy are currently seen heading into the Mediterranean.
In Algeria, light sweet Saharan Blend levels ticked up to Dated +0.30, despite continued weaker naphtha margins in the Mediterranean. A mid-to-later August loading cargo was heard to have traded as high as Dated +0.35, but this was not confirmed. More prompt loading dates were assessed lower. Trade is expected to pick up after the Eid public holiday.
Argus Crude
