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* OPEC could agree first output cut in nearly a decade
* Asia, no. 1 oil user region, already imports non-OPEC oil
* Refiners say open to seeking 'new supply opportunities'
* Tankers bring more Alaska, N. Sea, Azeri oil to Asia
* Russia leapfrogs Saudi Arabia as China's top supplier
By Henning Gloystein and Yuka Obayashi
SINGAPORE/TOKYO, Nov 29 For the first time since
2008, OPEC is set to strike a deal to cut oil output that may
boost prices. It may also give itself a bloody nose in Asia,
where big buyers are ramping up supplies from elsewhere and say
they don't want to pay more for fuel.
The Organization of Petroleum Exporting Countries (OPEC)
meets on Wednesday to hammer out a deal to prop up prices
that have halved since 2014. As they gather, tanker
shipments to Asia from non-OPEC sources like Alaska, Azerbaijan,
and the North Sea are growing, according to shipping data in
Thomson Reuters Eikon. (tmsnrt.rs/2fvsKBo)
Buyers in Asia, which alone uses a third of the world's oil
supply, have watched with concern as OPEC suppliers - their
biggest - openly discuss propping up prices. With non-OPEC
supplies readily available, they say they'll consider exploring
new sources if the cartel's price is no longer right.
"For us, the current price levels look to be appropriate for
both sides (buyers and producers)," said Eiichiro Kitahara,
Executive Officer at major Japanese refinery TonenGeneral Sekiyu
"Our company aims to avoid depending highly on certain
suppliers, and we may seek new (supply) opportunities," Kitahara
said, though like other executives he cautioned against
expectations of any sudden change in supply trends among buyers.
Major importers in Japan, China and South Korea have
long-standing relationships with OPEC suppliers, with just its
Middle East members providing two-thirds of Asia's oil needs.
Those ties could loosen, with refiners in countries like
Japan - which gets around 90 percent of its oil from Middle East
OPEC-members - keen to diversify sources to cut reliance on any
In China, now challenging the United States as the world's
biggest oil importer, efforts to reduce dependence on Middle
East supplies have already seen OPEC kingpin Saudi Arabia lose
its no.1 supplier rank to its rival Russia. Eikon data shows
Middle East producers' share of China's supply market fell from
50 percent in January to 46 percent in November.
PRICE - THE BOTTOM LINE
Oil markets remained jittery ahead of the OPEC meeting.
But refiners across Asia remain alive to the prospects of
shifting market dynamics and how they could make other suppliers
more attractive, even as OPEC seeks a price rise to boost the
economies of countries that rely heavily on crude exports.
"We are closely monitoring the OPEC meeting," said Kim
Woo-Kyung, a spokeswoman at major South Korean refiner SK
Innovation. "Even if OPEC cuts output, it won't have
a big impact (on SK Innovation business) as there are a lot of
supplies out there."
Despite Asia's openness to new suppliers, price remains the
Most Middle Eastern crudes cost between $45 and $48 per
barrel - ahead of any production cut accord - a competitive
price versus supplies from elsewhere when shipping fees are
North Sea crudes like Britain's Brent and Forties, or
Norway's Oseberg, cost between $46 and almost $47 a barrel,
Azeri Light crude is currently priced at over $48, while Alaska
North Slope crude is on the market for $46.30 per barrel.
Fatih Birol, Executive Director of the International Energy
Agency (IEA), which represents interests of oil consumers, told
Reuters at a conference in Tokyo that an OPEC cut designed to
raise prices could trigger an increase in output by other
producers elsewhere - an increase in supply that could end up
pegging prices back.
"If prices are pushed up towards $60 we will see within nine
months a strong response from U.S. shale production putting oil
in the market," Birol said.
OIL TO ASIA
In the United States, suppliers are poised to take advantage
of any shift in buying patterns.
"Asian (oil) dependence on the Middle East is higher than
they are comfortable with," said Bill Walker, Governor of
Alaska, speaking during a recent visit to Japan. "They'd like to
see something coming out of the U.S. We have seen some shipments
come over (to Asia) and I think we are going to see more."
"Our location is an advantage. It's seven days of transit
(to Japan)," he added, compared with around three weeks it takes
to get Middle East oil to Japan.
U.S. crude supplies to Asia from Alaska remain rare, but
they have gradually picked up this year - after years of strict
government restrictions on oil exports ended. Last month, BP
sold its first shipment U.S. crude to Thailand and
Another exporter seeking to place more oil into Asia is
Azerbaijan. The mid-sized producer pumps under 900,000 barrels
of crude per day - and isn't a member of OPEC.
Eikon trade flows show almost 7 million barrels of Azeri
Light crude were loaded for Asia in October, bound for mainland
China, Taiwan and India - the highest volume since records began
in January 2015.
Shipping data also shows large amounts of North Sea oil -
especially British Forties grade crude - currently aboard
supertankers heading for northeast Asia. North Sea crude oil
flows to the region as a whole have jumped, with 10.7 million
barrels arriving in November, their highest level since December
last year, Eikon data shows.
(Reporting by Henning Gloystein in SINGAPORE and Yuka Obayashi
in TOKYO; Additional reporting by Aaron Sheldrick in TOKYO,
Florence Tan in SINGAPORE and Jane Chung in SEOUL; Writing by
Henning Gloystein; Editing by Kenneth Maxwell)