June Exports of CPC Blend Fall to 1.45 million bpd

The Caspian Pipeline Consortium (CPC) plans to export about 1.45 million barrels per day (bpd) of CPC Blend crude in June, down from around 1.8 million bpd expected in May, due to planned maintenance at Kazakhstan’s giant Kashagan oilfield, three industry sources said.

June loadings would be about 17% lower on a daily basis than in May, which is set to hit a multi-month high, according to Reuters calculations.

CPC does not comment on operational shipment data.

According to sources, maintenance at the Kashagan field, which has capacity of about 0.4 million bpd, is set to start in early June and may last more than 30 days, reducing Kazakhstan’s overall oil output and exports.

The volume of CPC Blend supply in June will also depend on how much Russian crude is fed into the pipeline, sources told Reuters.

Russia’s Novatek has been forced to redirect some gas condensate supplies into the CPC system after its processing plant in Ust-Luga, which handles the light crude, was hit by drone attacks, sources said.

Additional volumes could also reach the CPC after Russia halted transit of Kazakh oil to Germany via the Druzhba pipeline from May 1. Kazakh crude volumes are set to be redirected to other routes, including the port of Ust-Luga and the CPC, sources said.

Differentials for CPC Blend crude have weakened recently after hitting historic highs in mid-April, according to Reuters data.

Traders said high outright prices and firm CPC Blend premiums have kept cargoes in Europe, with weak Asian demand creating an overhang. Shipments to Asia fell sharply in May from April, they added.

CPC shareholders include Russia with 31%, Kazakhstan with 20.75%, U.S. major Chevron with 15%, and several private companies.

(Reuters)