• English
  • 简体中文
  • 繁體中文
  • Tiếng Việt
  • ไทย
  • Indonesia
Subscribe
Real-time News
Gold prices fell slightly on Tuesday, October 21, as investors took profits after gold prices hit a new high in the previous trading day. Tim Waterer, chief market analyst at KCM Trade, said, "Profit-taking and weakening safe-haven inflows have weakened the advantage of gold prices today... Any pullback in gold will be seen as a buying opportunity, and the Federal Reserve is still on the track of interest rate cuts. If the US CPI data released later this week does not bring any unpleasant upward surprises, then the current gold price rally has further room to rise."Insurers managing $23 trillion plan to further increase their holdings of private market assets to achieve smooth long-term returns, according to a BlackRock survey.On October 21st, the overnight Shibor (Shibor) rate was at 1.3170%, unchanged from the previous trading day. The 7-day Shibor rate was at 1.4260%, up 0.80 basis points; the 14-day Shibor rate was at 1.5040%, up 3.60 basis points; the January Shibor rate was at 1.5570%, unchanged from the previous trading day; and the March Shibor rate was at 1.5860%, up 0.40 basis points.Hong Kong-listed consumer stocks weakened, with Pop Mart (09992.HK) falling more than 5%, Gu Ming (01364.HK) falling more than 4%, and BRUCO (00325.HK), Laopu Gold (06181.HK), and Mixue Group (02097.HK) following suit.Futures data from October 21st revealed that as of October 20th, the mainstream benzene market in East China closed at 5,535 yuan/ton, down 220 yuan/ton from 5,755 yuan/ton at the beginning of October. Looking at the post-holiday market, major ports in East China maintained a steady pace of destocking in early October, but concerns about crude oil oversupply intensified, with Brent crude futures falling to a five-month low and weakening market sentiment. Coupled with a lack of downstream market support, exacerbating losses, and a lack of new orders from end users, secondary downstream inventories remained high and difficult to reduce, creating significant price transmission resistance. The market may face downward pressure in late October.

China's State Refiners Avoid New Russian Oil Deals

Aria Thomas

Apr 07, 2022 09:37

O2.png


Sinopec (NYSE:SHI), Asia's largest refiner, CNOOC (NYSE:CEO), PetroChina, and Sinochem have all stayed out of the market for fresh Russian cargoes for May loadings, according to the people, who are all familiar with the matter but spoke on condition of anonymity due to the sensitivity of the subject.


Chinese state-owned firms do not want to be perceived as openly supporting Moscow by purchasing additional volumes of oil, according to two of the people, following Washington's ban on Russian oil last month and the European Union's sanctions on Russia's top exporter Rosneft and Gazprom (MCX:GAZP) Neft.


"SOEs are circumspect because their acts may be seen as reflecting the Chinese government, and none of them wants to be singled out as a buyer of Russian oil," one of the persons said.


Sinopec and Petrochina did not respond to requests for comment. Sinochem and CNOOC did not react quickly to a request for comment.


China and Russia have become more close in recent years, notably announcing a "no boundaries" alliance in February, and China has declined to denounce Russia's behavior in Ukraine or label it an invasion.


China has consistently criticized western sanctions against Russia, yet a top official said on Saturday that Beijing is not evading sanctions on Russia on purpose.


China, the world's biggest consumer of oil, is Russia's largest customer of crude, purchasing 1.6 million barrels per day, half of which is provided through pipelines under government-to-government contracts.


According to sources, China's state-owned enterprises would honor current and long-term contracts for Russian oil but will avoid new spot purchases.


A decline in China's imports of Russian oil could prompt the country's massive state refineries to seek alternative sources, escalating global supply concerns that pushed benchmark Brent oil prices to 14-year highs near $140 per barrel in early March, following Russia's invasion of Ukraine on Feb. 24.


Brent prices have subsequently fallen below $110 after the announcement by the US and its partners to release inventories from strategic reserves. [O/R]

'PRIORITY IS GIVEN TO RISK CONTROL AND COMPLIANCE'

Prior to the Ukraine crisis, Russia provided 15% of China's oil imports, half through the East Siberian and Atasu-Alashankou pipelines and the remainder via tankers based in Russia's Black Sea, Baltic Sea, and Far East ports.


Unipec, Sinopec's trading arm and a major Russian oil customer, has informed its worldwide teams in recent weeks at regular internal meetings about the dangers associated with dealing with Russian oil.


"The message and tone are clear - risk management and compliance take precedence above revenues," one individual informed on the discussions said.


"While Russian oil is significantly reduced, there are several complications, such as acquiring shipping insurance and payment snags."


Another source with a refinery that processes Russian crude on a regular basis said that his unit was instructed by Unipec to locate a substitute in order to maintain normal operations.


"With the exception of shipments that came in March and are scheduled to come in April, there will be no more Russian oil," this person said.


According to traders and shipping statistics, Unipec loaded 500,000 tonnes of Urals from Russia's Baltic ports in March, the greatest amount in months. The Urals were provided on spot and via a Rosneft export deal that Unipec won for loadings between September 2021 and March 2022.


Its most recent Urals deals involve two April-loading shipments totaling 200,000 tonnes from Russian producer Surgutneftegaz, according to two traders familiar with the transactions.


In comparison, India has reserved at least 14 million barrels, or approximately 2 million tonnes, of Russian oil since Feb. 24, compared to nearly 16 million barrels for the entire year of 2021, according to Reuters calculations.


Other state buyers, including PetroChina, CNOOC, and Sinochem, have reportedly avoided Russia's ESPO blend for May loading.


Sinopec is experiencing payment difficulties even for previously signed agreements, as risk-averse state banks seek to reduce their exposure to Russian oil-related transactions, the second person added.

DEALS ARE KEPT 'UNDER WRAPS' BY TEAPOTS

Sanction fears have prompted some independent refiners known as teapots to disappear. They were once a vibrant group of customers consuming roughly a third of China's Russian oil imports.


"Trading in ESPO was extremely slow and secretive. Certain transactions are taking place, but specifics are being withheld. Nobody likes to be seen in public purchasing Russian oil "According to a frequent ESPO dealer.


To keep oil flowing, these agile refiners are experimenting with alternate payment methods such as cash transfers, payment upon delivery of cargo, and the use of Chinese money.


In May, Rosneft, Surgutneftegaz, and Gazprom Neft, as well as independent producers represented by Swiss trader Paramount Energy, are set to transport a record 3.3 million tonnes of ESPO from Kozmino port.