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The reduction in OPEC production and US sanctions on Venezuela and Iran limit the availability of corrosive and corrosive crude grades in Europe, where prices of the heaviest categories have recently risen in a contractionary context market, say the rough traders at S & P Global Platts.
US sanctions against Iran had already limited some of the heavy supply in Europe. Then, with the new round of cuts between OPEC member countries and non-OPEC countries that began in January, the legendary Iraqi companies of Basra, very much in vogue among European refiners , were also penalized on the spot market as Iraq diverts more barrels from Basra. in the high-end market for producers in the Middle East: Asia.
"There is currently no cargo destined for Basra that arrives in Europe at the end of February, because it targets Asia," said a trader crude oil Platts.
To complement the sanctions imposed on Iran and OPEC, US sanctions applied to Venezuela at the end of January have further tightened the heavy crude market in Europe and traders expect an even stronger contraction. market in the coming months.
The sanctions imposed on Venezuela and Iran, as well as the cuts imposed by OPEC, have resulted in a huge imbalance between slightly sweet qualities and strongly acidic qualities, especially in Europe, while the producers Middle East oil and other producers seek to maintain their sales in the Asian market. .
As a result of the contraction in the supply of medium and heavy corrosive crude oil, Middle East benchmarks for sour crude traded higher than Brent crude prices in early February, in a pattern rarely seen world oil prices.
In Europe, some grades of sour crude, such as the Russian Urals, have begun to sell at a cheaper price than the milder crudes due to limited availability of corrosive and heavy crude, according to S & P data. Global Platts.
"The Urals have positive numbers, Basrah is trading at huge prices compared to OSP and I do not see why acid should soften, the demand is there but there is not much availability" said a trader at Platts.
By Tsvetana Paraskova for Oilprice.com
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