* North Sea output to rise by 25 percent in October
* Increase due to planned end of maintenance work
* Forties shipments to South Korea support market
By Alex Lawler
LONDON, Sept 13 (Reuters) - North Sea crude oil output from 12 production streams is set to rise by about 25 percent in October as planned maintenance work at offshore installations is completed, weakening a source of support for Brent oil prices.
While overall supply will rise, there are signs of higher demand from outside the region. Royal Dutch Shell and Total on Thursday were reported to have arranged to ship millions of barrels in October to South Korea.
The supply increase, and expectations of reduced demand in October from some European refineries, could weigh on the market, analysts have said. But the sale of crude outside Northwest Europe could prop up values.
“These volumes going to South Korea again is certainly going to support the market,” said Eugene Lindell, senior crude market analyst at JBC Energy in Vienna.
Supply from the 12 crudes tracked by Reuters will average 1.97 million barrels per day (bpd) in October, up from 1.57 million bpd in September, according to Reuters calculations on Thursday based on loading programmes.
North Sea crude underpins the Brent crude contract used as a global benchmark. Forties is the most important of the 12 crudes for pricing because it sets the price of dated Brent, the benchmark for pricing much of the world’s physical oil.
Output is rising in October partly because of the planned completion of maintenance work on Nexen’s Buzzard oil field, which supplies the bulk of Forties crude, and higher supply of Norwegian crude Troll.
A drop in North Sea supply scheduled for September had led to an increase in oil prices because crude from the region underpins the Brent crude contract used as a global benchmark.
North Sea output in October will be the highest since June, when supply was 2.11 million bpd, according to Reuters data.
Much of the supply rebound in October is due to come from Forties. The number of 600,000-barrel Forties cargoes is set to rise to 16 from 10 originally planned in September.
But there are signs October’s loading schedules may prove to be optimistic. The loading dates of three Forties cargoes have been delayed this month and next due to lower-than-expected production, trading sources said on Wednesday.
And if the two Very Large Crude Carriers, each holding 2 million barrels, reported fixed by Shell and Total on Thursday, do transport Forties crude to Korea, that would remove almost seven of October’s 16 cargoes from Northwest Europe.
The flow of Forties to Asia had slowed to a trickle in recent weeks due to maintenance at the Hound Point terminal where Forties is loaded, which is preventing it from handling VLCCs until mid-September.
Shipment of Forties to South Korea has become a more common feature of the market this year. A July 2011 free trade agreement between Europe and South Korea improved the economics of selling oil from the North Sea half a world away.