Russia’s Rosneft to raise July Group I base oil supply to China

19 June 2012 07:35  [Source: ICIS news]

SINGAPORE (ICIS)--Russian oil giant Rosneft plans to increase its Group I base oil supply to China in July by 33% month on month to 8,000 tonnes, a China-based importer said on Tuesday.

Out of the 8,000 tonnes, all produced at the company’s Angarsk 250,000 tonne/year base oil plant, 5,000 tonnes will be low-viscosity N150 and N250, while 3,000 tonnes will be high-viscosity N450 and N650, the importer said.

Rosneft cut its June exports to China by 24% from May to 6,000 tonnes, as Chinese buyers were reluctant to accept Russian products at higher costs in a weak Group I base oil market in China, the importer added.

The prices of Rosneft supplies for June and July are expected to drop as the domestic prices of Group I base oils in China have been falling since late May, major Chinese traders of Russian oil said.

The prices of Rosneft's low-viscosity cargoes to China in May were at $1,060-1,070/tonne (€837-845/tonne) DAF (delivery at frontier) Erenhot, while its high-viscosity base oil prices were at $1,170/tonne, according to traders.

Some China-based traders are willing to take Russian product if Rosneft reduces its July offer, the traders added.

Rosneft supplied about 7,900 tonnes of Group I base oils to China in May.

($1 = €0.79)
By: Whitney Shi
+65 6780 4359

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