Aramco sells May Jubail lot to Vitol
Singapore, April 28, 2009
Saudi Aramco, the world’s top oil explorer, has sold 90,000 tonnes of cracked 380-centistoke (cst) fuel oil from Jubail for lifting on May 12 to Vitol at similar discounts to previous deals, traders said.
Vitol paid a discount of around $7 per tonne to Singapore spot quotes, on a free-on-board (FOB) basis, for the cargo via private negotiations.
This is similar to a discount of $7 to $8 a tonne that France's Total paid for a 40,000-tonne parcel, loading on April 28-30, also from Jubail.
Total had previously purchased two 80,000-tonne 380-cst lots from Aramco for April 5-7 and March 20-24 lifting, also at around a discount of $8.00 per tonne, FOB.
The Asian fuel oil market has strengthened over the last two weeks. The timespreads have flipped into backwardation as sentiment firmed on the prospect of tighter supplies ahead.
Fewer arbitrage barrels are expected to land in Asia in May -- falling about 18-20 per cent from April -- as European refiners slash capacity on poor margins.
Middle Eastern supplies are also shrinking in line with the peak summer demand season, soaking up fuel oil for domestic power generation. – Reuters
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