Qatar Crude Re-Enters Asian Market as Strait of Hormuz Sees Increased Activity
Oil flows are picking up again in the region as Gulf countries restart crude exports following a period of quiet during the war. The long-choked Strait of Hormuz is finally seeing business with supplies from Qatar entering the market for the first time since the conflict broke out.
A shipment of Qatar‘s Al-Shaheen grade was sold this week to Taiwan’s Formosa Petrochemical Corp, which was seeking supplies for August to September, according to traders familiar with the matter. The volumes were sold by trading house Mercuria Energy Group Ltd, they told Bloomberg. Traders also said that some of the same grade, along with Qatar’s Marine and Land varieties, were sold to an Indian refiner last week.
Regional Activity Improves as Talks Between US and Iran Move Forward
The improvement in regional activity is helping ease tensions in the area. The Strait of Hormuz has seen increased tanker activity, with state-owned QatarEnergy issuing its first crude oil sell tender since the war began. The tender offers cargoes for July and August, which can be collected within the Persian Gulf or via ship-to-ship transfer at locations just outside the Strait of Hormuz.
Qatar has continued to move liquefied natural gas tankers in and out of the Persian Gulf through the strait. It is also planning to rapidly increase production of LNG once the waterway fully reopens, aiming to restore most export capacity within two months, according to people familiar with the matter.
Tanker Activity Increases Near Qatar’s Ras Laffan Facility
Tanker activity has also increased near Qatar‘s Ras Laffan facility. The Greek-owned supertanker Kiku was seen loading 2 million barrels of Qatari crude from the Al-Shaheen floating storage and offloading terminal, according to ship-tracking data. The Kiku entered the Persian Gulf on June 19 after last broadcasting from the Gulf of Oman on June 13, making it one of the first large crude carriers to enter the Gulf since the US-Iran deal.
Middle Eastern Fuel Oil Exports Expected to Rebound
Middle Eastern fuel oil exports are also expected to rebound to a four-month high in June, with Iraq and Saudi Arabia diverting supply to other ports as shipments through the Strait of Hormuz increase, according to trade sources and shipping data. Oil futures have fallen sharply this month, though prices edged higher on Thursday after an attack on a cargo ship in the Strait of Hormuz raised fresh concerns over safe passage through the waterway.
Regional Exports Expected to Reach 2.4 Million Metric Tons
Data from Kpler and LSEG shows regional exports are expected to reach about 2.4 million metric tons (508,000 barrels per day) this month, up more than 20% from May. However, this remains well below the monthly average of 5.5 million to 6.0 million tons recorded before the war.
According to Palash Jain, Middle East oil consultant at FGE NexantECA, fuel oil flows through the Strait of Hormuz are expected to increase over the next 60 days, though the recovery is unlikely to be substantial. He added that uncertainty over the outcome of negotiations and the durability of the peace deal is likely to keep shippers cautious.
Aframax Tanker Exits Strait of Hormuz
Late on Wednesday, Aframax tanker Gamsunoro, carrying about 80,000 tons of fuel oil loaded in Iraq, exited the Strait of Hormuz and headed for Fujairah, shipping data on LSEG showed.
Original Article: Qatar crude enters Asian market again as Hormuz gets back to business — Indiatimes