Brazil boosts oil exports to Asia as global rivals make record cuts
RIO DE JANEIRO/MEXICO CITY Brazil increased crude exports to Asia in the first half of the year, stealing a slice of a coveted developing market from global rivals who made record cuts to shipments to match the unprecedented fall in demand caused by the coronavirus pandemic.
The rise reflects Brazil’s growing clout among global oil producers as its massive offshore projects come online. Brazil is expected to deliver one of the biggest increases to global supply in the next five years from nations outside of the Organization of the Petroleum Exporting Countries, according to the International Energy Agency. State oil firm Petrobras (PETR4.SA) offered Asian refiners competitive deals on relatively highquality oil just as China and other countries in the region reopened their economies and as Western nations went into lockdowns to curb the spread of coronavirus, traders said. China also took advantage of the lowest oil prices in decades to fill up strategic storage. “If we had more oil available, China would buy it,” Petrobras Chief Executive Roberto Castello Branco told Reuters in a written response to questions. Castello Branco said there was no more to sell to further boost exports, because demand in Brazil has been recovering. China is now the destination for 70% of the country’s exports, Petrobras said in a statement to Reuters.
Asia imported an average of 1.07 million barrels per day of oil from Brazil in the first half of the year, 30% yearonyear hike, according to Refinitiv Eikon’s trade flows data. A record 1.62 million bpd of Brazilian crude arrived in Asian ports in June, almost triple the volume in June 2019, according to the data. Graphic showing Asia’s oil imports from Latin America: here Asian refiners were keen for the lowsulfur oil that Brazil sells, as they sought to comply with new maritime regulations to supply ships with cleaner fuel. The oil is from Brazil’s prolific offshore deposits known as presalt fields, which Petrobras and oil majors are spending hundreds of billions of dollars to develop. That offered Petrobras an opportunity to grow its market even as OPEC and its allies, collectively known as OPEC+, cut supplies by a record 9.7 million bpd. ( Reuters )