US refiners Phillips 66, Citgo, Valero seek to buy crude directly from Venezuela

Phillips 66, Citgo seek to purchase directly starting in April, Valero later in the year, bypassing the trading houses to get a bigger share of the spread.

HOUSTON, Feb 18 (Reuters) - U.S. refiners Phillips 66 and Citgo Petroleum are seeking to buy heavy crude directly from Venezuelan state oil company PDVSA starting in April to maximize profits, rather than purchasing through trading houses and U.S. oil major Chevron (CVX.N), according to sources familiar with the efforts.

Trading houses Trafigura and Vitol in January secured the first U.S. licenses to export Venezuelan oil as part of a $2 billion deal between Caracas and Washington. Chevron has held an authorization to operate there and ship crude since last year.

Phillips 66 (PSX.N), one of the biggest U.S. refiners, is seeking compliance and internal clearance to purchase directly from PDVSA, three sources said. Once the company is ready, it plans to charter tankers to load the crude at PDVSA's terminals, one of the sources added.

The company bought Venezuelan oil from Vitol last month at

The Second Wave of the Russian Oil Shock Is Starting

Cliff Edge

Russian oil production has fallen sharply so far in April, with the monthly average heading to 10 million barrels a day, its lowest since September 2020

Sources: Bloomberg and OilX

April is forecast based on current production trends

Flaring data, combined with anecdotal information from traders and leaks of official Russian statistics, suggest that eight weeks into the war, Moscow is finally succumbing to the impact of government-imposed penalties and companies’ self-sanctions. On average, Russian oil output is down 10% from its pre-war level.

More production losses are likely as Western refiners and traders walk away from Russia upon the expiry of supply contracts in coming weeks. 

Declining crude output identified by satellite imagery heralds a longer-lasting increase in oil prices.

See the whole piece on Bloomberg here: The Second Wave of the Russian Oil Shock Is Starting:

#PDVSA having hard time finding buyers for 80% of February crude #Oil production

"For February, there is 661,000 b/d of crude that has no takers. Also, PVDSA is offering to pay debts with crude to creditors but there are no interested parties," the official added.

PDVSA has offered deep price discounts for its crude, and flexible loading windows of more than 30 days  ...

The volume available for sale represents 80% of the 850,000 b/d total crude production estimated by PDVSA for February  

Highlights

Caracas, Venezuela — Venezuela's state owned PDVSA has 677,000 b/d of crude available to sell for February, but no buyers because of US sanctions, according to a company official.

"The climbing of US sanctions against the Nicolas Maduro government alienated the few clients that were still daring to enter Venezuelan ports," said a PDVSA official, who spoke on condition of anonymity.

"For February, there is 661,000 b/d of crude that has no takers. Also, PVDSA is offering to pay debts with crude to creditors but there are no interested parties," the official added.

#LNG Grows for Trading Houses From @Gunvor to @Trafigura, @Glencore - Bloomberg

LNG is enjoying more rapid growth with about $150 billion in revenue last year, according to McKinsey Energy Insights. By next year, LNG volumes will be more than triple what they were at the start of the century, making it the quickest-growing segment of the fossil-fuel industry, according to Shell.

Commodity Traders Turn to LNG as Big Oil Profits Prove Elusive

Gunvor, Vitol and Trafigura are doing for natural gas what they did in the oil market in the 1970s.

By Anna Shiryaevskaya and Andy Hoffman

March 27, 2019, 6:00 AM GMT+1 Updated on March 27, 2019, 12:33 PM GMT+1

With margins narrowing in the crude oil business, some of the world's biggest commodity trading houses are helping to reshape the energy industry with a drive into liquefied natural gas.

Gunvor Group Ltd., Trafigura Group Pte. Ltd. and Vitol SA have moved a step beyond trading LNG, investing in ships and terminals handling the fuel. That's accelerating the growth of the industry, moving more gas that traditionally has flowed through pipelines onto ocean-going tankers chilled to minus 162 degrees Celsius (minus 260 degrees Fahrenheit).

Those houses in the 1970s broke away from Big Oil's long-term contracts and created a market where cargoes change hands in the blink of an eye. Now they're turning their attention to LNG, where spot trading is rapidly expanding. The result is handing utilities from Centrica Plc to RWE AG more flexibility to buy gas, encouraging them to make the leap away from more polluting coal.

"It looks like a much younger crude oil market,'' Russell Hardy, chief executive officer of Vitol, said in an interview in Lausanne, Switzerland. "It is an area that can grow and that is a positive for us.''

A Boom for LNG

Volumes by the end of this decade will at least triple since 2000.

The top three commodity trading houses active in LNG have more than doubled their delivered volumes over the past two years and took almost 9 percent of the global trade in 2018, according to data compiled by Bloomberg. Royal Dutch Shell Plc remains the industry leader with 22 percent and stakes in LNG plants and import terminals.

Other traders such as Glencore Plc and Koch Supply & Trading LP also are building expertise or looking to expand in LNG. Most trading houses set up their desks earlier this decade, while Vitol started back in 2005.

Trading Houses in LNG

Three largest commodity traders have boosted volumes in past few years.

#Commodities, #Geneva and the Swiss franc @FT

 According to the Swiss Trading and Shipping Association, the country’s commodity sector consists of about 500 companies which account for SFr20bn, or 3.5 per cent, of the country’s GDP. The industry employs between 10,000 and 12,000 people. 

"... in true trader style, what upset Swiss-based dealers most about the currency jump seemed to be the missed opportunity of not being able to take advantage of the government’s decision...Some traders were more frustrated about the limited ability to profit from the volatility...."

Read the whole article here:

#Commodities, #Geneva and the Swiss franc @FT


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