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First Arrival of Canada’s Kearl Lake Crude in China Since 2018: Platts

OIL

Arbitrage flows of Canadian heavy crude to China continue with the Kearl Lake Blend making its return for the first time since 2018, Platts said.

  • This is also the first time that the grade was transported via the Trans Mountain Pipeline.
  • The Aframax cargo was bought at around a $5-$6/b discount to Jan ICE Brent by Rongsheng Petrochemical.
  • Kearl Lake is a similar grade to Venezuelan heavy crudes, Iraqi Basrah heavy, and Western Canadian Select. Its production was round 255k b/d in Q2.
  • However, Kearl Lake cannot produce asphalt, unlike Venezuelan crudes.
  • Venezuelan crude tends to go to independent refineries in Shandong, with November delivery at a discount of around $12-$13/b vs ICE Brent.

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