W. Africa Crude-Unipec halts WAF buying, offers cargoes as freight plummets

 LONDON, Feb 3 (Reuters) - China’s Unipec, a top buyer, has
halted purchases of West African crude oil despite a sharp drop
in shipping rates as the coronavirus outbreak cuts demand. * Instead of seeking them for domestic use, Unipec sought to
sell off at least five cargoes of West African oil, mostly from
Angola * It was offering two cargoes of Gindungo at dated Brent
flat, a Pazflor at plus $1.10, a Sangos at plus 50 cents and a
Saturno at minus 65 cents * Asia’s largest refiner, China's Sinopec Corp, instructed
its plants to cut throughput this month by around 600,000
barrels per day as the rapidly spreading coronavirus hits fuel
demand, sources told Reuters * The cuts are the steepest in over a decade and come as
independent refiners also reduce runs by 30-50% * Contagion fears have hit the Chinese aviation sector in
particular with jet fuel cracks hitting their lowest levels in a
decade on Monday at $8.64 per barrel over Dubai crude before
inching up in later trading * One trader said the world’s top crude importer was
increasingly “working from home” as more major airlines halted
flight links and demand for refined products nose-dived * Freight rates for VLCC tankers eastward plunged to among
their lowest levels since September * Despite those discounts, Europe is set to be the most
likely market for West African heavier oils, though jet fuel
margins in Western markets also plumbed multi-year lows * So far, European refiners have held off on purchases and
still believe offers will fall further * “Distillate margins are still low, but as the prices
should drop, (we) probably can compensate, as freight rates are
coming off,” one potential buyer said RELATED NEWS * OPEC and its allies are considering cutting their oil
output by a further 500,000 barrels per day (bpd) due to the
impact on demand from the coronavirus, three OPEC+ sources and a
industry source familiar with the discussions said * It's good news that Angola's Isabel dos Santos has decided
to sell her investments in Portuguese companies, Portugal's
Economy Minister Pedro Siza Vieira told Reuters, saying that
would avoid any potential damage to them as she battles fraud
charges (Reporting by Noah Browning, editing by Louise Heavens) ))
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