S.Korea's GS Caltex buys Russian, U.S. crude amid ongoing oil glut (updated)

GS Holdings

24/04/2017 04:36

* GS Caltex buys 700,000 barrels of Urals crude for 1st time 
    * Resumes U.S. Eagle Ford imports after 6 months 
    * Purchases are aimed to diversify supplies 
 
 (Adds detail, graphics, interactive map) 
    By Jane Chung 
    SEOUL, April 24 (Reuters) - South Korea's GS Caltex has 
bought Russian Urals crude for the first time and also ordered 
large volumes from the United States, taking advantage of ample 
supplies despite pledges by OPEC and Russia to cut output and 
tighten the market. 
    GS Caltex, a unit of GS Holdings Corp  078930.KS , purchased 
700,000 barrels of Russian Urals crude and 500,000 barrels of 
U.S. Eagle Ford crude, both for delivery in June, a company 
spokesman said on Monday.  urn:newsml:reuters.com:*:nL4N1DH2QY 
    "We bought the Russian crude in the spot market as it has 
become more economical and as a way to diversify our crude 
supplies," the spokesman said.  
    The orders are part of a trend in Asia as refiners buy more 
oil from Europe and the Americas as supplies became more 
competitive against Middle East oil after the Organization of 
the Petroleum Exporting Countries (OPEC) and some other 
producers, including Russia, cut output.  urn:newsml:reuters.com:*:nL3N1H83P7 
 urn:newsml:reuters.com:*:nL8N1FY3L8  urn:newsml:reuters.com:*:nL4N1F12DP 
    "Following OPEC-led output cuts, the price of crudes from 
the Atlantic has become relatively cheaper than that of Middle 
Eastern crudes," Lee Dal-sok, senior research fellow at 
state-run Korea Energy Economics Institute said.  urn:newsml:reuters.com:*:nL3N1HT257 
    The cargo is on the supertanker Gener8 Miltiades which is 
estimated to arrive at Yeosu on June 4, oil trade flows data on 
Thomson Reuters Eikon showed. 
    GS Caltex, the country's second-largest refiner, is not the 
only Korean company ordering Russian Urals crude. 
    In February, South Korea's top refiner SK Energy  SKENGG.UL  
bought 1 million barrels of the Urals grade for the first time 
in 10 years.  urn:newsml:reuters.com:*:nL4N1G22CW  
     
    RECORD SUPPLIES 
    The orders from South Korea underscore a rise in global oil 
shipments, which have never been higher despite efforts by OPEC 
and Russia to cut production.  urn:newsml:reuters.com:*:nL1N1HS1G4 
    This is because many countries that pledged to cut have 
reduced output by less than agreed levels. Meanwhile, other 
producers, like the United States, have increased exports. 
    Eikon data shows that OPEC shipments to Asia - the world's 
biggest and fastest growing oil consuming region - hit 17.7 
million barrels per day (bpd) in April, up 8 percent since 
December, before the cuts were implemented. 
    Russian shipments to Asia have jumped around 30 percent 
since December, to 1.19 million bpd, and U.S. exports to Asia 
soared more than six-fold to 0.63 million bpd between December 
and April. 
    Global oil shipments in April stood at 49.5 million bpd, up 
by almost 10 percent since the output cuts were implemented. 
 
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CHART-Record oil shipments    http://reut.rs/2pV0qww 
GRAPHIC-What tighter oil supply? IMG    http://tmsnrt.rs/2pElIP6 
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 (Reporting By Jane Chung in SEOUL; Additional reporting by 
Florence Tan and Henning Gloystein in SINGAPORE; Editing by 
Richard Pullin) 
 ((jane.chung@thomsonreuters.com; +82 2 3704 5667; Reuters 
Messaging: jane.chung.thomsonreuters.com@reuters.net)) 
 
Keywords: SOUTHKOREA GSCALTEX/OIL