Firms have stashed their crude surplus in South Korea as coronavirus slows demand
Picture: REUTERS/CHRISTIAN HARTMANN
Trading firms Trafigura, Glencore and Mercuria, as well as the trading division of French oil major Total, have rented close to 15-million barrels of storage tanks from South Korea’s state oil firm Korea National Oil Corporation , the sources said. Lower demand from China caused the Brent and Dubai market to flip into contango earlier in February for the first time since July 2019, as prompt prices fell below forward prices.
A Chinese trader said storage leased in South Korea won’t be enough to hold the overhang in the market, which has already caused spot premiums for Russian ESPO crude, a popular grade among Chinese buyers, to hit a two-and-a-half-year low.
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