Asian crude oil buyers are keeping an eye out on key prices from state-owned Qatar Petroleum this week. It is due to release official selling prices for Qatar land and marine crudes loaded in October, as well as issue a spot tender offering medium sour Al-Shaheen crude for loading in January.
Meanwhile, high-profile arrests in Saudi Arabia over the weekend have further tightened Crown Prince Mohammed bin Salman's grip on power. The move may have little implications for oil markets but could impact the investment climate in the world's largest crude oil exporting nation.
In this episode, Platts Market Movers - Asia also looks at LNG prices after the Japan Korea Marker hit a 10-month high last week, a key development in negiotiations in the paraxylene-PTA industry, as well as the narrowing spread between Australian premium white wheat and Black Sea wheat.
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Video Transcript
In this week’s highlights on Platts Market Movers Asia: Qatar Petroleum to release key prices, LNG hits a 10-month high, and Australia's wheat harvest gets underway.
But first, there were a series of high profile arrests in Saudi Arabia over the weekend that have further tightened Crown Prince Mohammed bin Salman's grip on power. The move may have little implications for oil markets but could impact the investment climate in the world's largest crude oil exporting nation.
Still in oil, Asian crude buyers will be keeping a close eye on state-owned Qatar Petroleum this week, which is due to announce its official selling prices for Qatar Land and Qatar Marine crudes loaded in October.
Traders are expecting both grades' OSP differentials to Platts Dubai to rise by at least 10 cents a barrel from September, reflecting the high spot premiums paid for the grades last month.
Qatar Petroleum is also due to issue a spot tender this week offering medium sour Al-Shaheen crude for loading in January.
This will be closely watched as well, with the grade’s monthly spot volumes trending lower amid Qatar's continued efforts to comply with the OPEC production cut agreement.
Elsewhere, China is due to release its preliminary trade data for October this week. All eyes will be on its crude imports, which topped 9 million barrels per day in September.
In LNG, the JKM hit a 10-month high last week and this rally could be driven further this week if Indian demand continues, or oil prices keep strengthening. Market players are watching for results of a key buy tender from Egypt this week for pricing guidance, as well as the potential release of cargo offers back into the market.
In petrochemicals, in a first for the China-focused paraxylene market, November 3 saw the last offers submitted for a Jan-Dec 2018 PX supply tender to the world’s largest PTA maker in terms of nameplate capacity, Yisheng Petrochemical. The move marks a departure from previous years’ negotiations in the PX-PTA industry, when long term contracts were normally discussed on a bilateral basis.
While it is still too early to call this a paradigm shift in the way contracts in the PX market are negotiated, the tender assumes significance against the backdrop of rising PX supply over the next year, and a weaker paraxylene-naphtha spread for PX producers.
The recent weak PX-naphtha spread, which hit a 30-month low on October 27 at $295/mt was one of the main reasons that the negotiations for the November Asian Contract Price failed to result in a settlement, the fourth such instance this year.
In metals, a price correction last week saw some buyers emerge in the seaborne iron ore market, but China's steel mills are continuing to keep their iron ore inventories low, dampening demand for steel raw materials, as the extent of winter output cuts remain uncertain.
Will the buying activity pick up this week? What do you think? Send us your views on Twitter with hashtag PlattsMM.
Finally, in agriculture, Australia's wheat market is expected to start picking up this week as the new crop wheat harvest progresses. The spread between the two main competing origins for Southeast Asia is narrowing, with Australian Premium White offered at around $25 per metric ton higher than Black Sea origin wheat last week, the lowest since June.
That’s it for this week. Thanks for kicking off your Monday with us and have a great week ahead!