Middle East Crude-Benchmarks mixed; ESPO prices soar on robust demand

Middle East crude benchmarks were mixed on Friday, with Dubai and Murban drifting lower while Oman rising as traders rushed to cover their positions before the contract expires.

Discounts for Russia’s ESPO Blend crude arriving in China in September were at their narrowest in eight months on firm demand from Chinese independent refiners, trade sources said.

Around a dozen cargoes of the light sweet ESPO were traded over the past week or so, at discounts of $2 to $2.50 per barrel to November ICE Brent on delivered-ex-ship (DES) basis to China for September, according to multiple trading sources, versus discounts of about $4 in the previous month.

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SK Innovation Co Ltd 096770.KS, owner of South Korea’s top refiner SK Energy, said on Friday it expects refining margins to gradually improve in the second half thanks to favourable market conditions backed by solid travel season demand.

China’s demand for petrol is likely to peak as early as next year as electric vehicle sales soar, several analysts say, bringing forward an energy transition milestone for the world’s biggest polluter and a headache for global refiners.

Vietnam is expected to see a decline in its annual crude oil and coal output during the rest of this decade, the Ministry of Industry and Trade said on Friday.

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Source: Reuters (Reporting by Muyu Xu; Editing by Shilpi Majumdar)