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Saudi keeps Asia crude supply steady

Tokyo, November 7, 2011

Saudi Arabia, the world's top crude exporter, will supply full contracted volumes of crude oil in December to at least three Asian term buyers, unchanged from November, industry sources familiar with the matter said on Monday.

The move, ahead of winter in the northern hemisphere, signals that changes in output are unlikely at an Opec meeting in December.

Senior officials from Qatar and Iraq have said they expect no major changes in Opec output at the December meet amid an increase in supplies from Libya.

Saudi Arabia unexpectedly cut official selling prices (OSPs) for most of its crude for December, helping lower costs for refiners that have been facing sliding profits from weakening gasoline and naphtha prices.

Some buyers of Saudi crude in Asia are considering requesting more than their contracted volumes in December, encouraged by the drop in OSPs, though many Asian refiners are unlikely to snap up extra cargoes from the country because of dwindling demand prospects.

Sources said extra barrels that the buyers could receive from Saudi are limited, however, due to restricted tanker capacity.

Traders said the steady allocations for December were expected, and that two of the buyers did not get changes in allocations of heavier and lighter crude.

Opec kingpin Saudi Arabia made no changes to the operational tolerance in the supply allocation, the sources added, meaning buyers have the option of asking for cargoes to be loaded with up to 10 percent more or less crude than contracted.-Reuters




Tags: Saudi | Opec | Asia | crude supply |

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