’Femi Asu with agency report
A number of Indian state-owned refiners
have been actively picking up Malaysian oil cargoes for loading in July
and August amid growing uncertainty over the exports of Nigeria’s crude
grades, according to regional sweet crude traders.
Bharat Petroleum Corporation Limited on
Monday issued a spot tender to purchase several Malaysian light sweet
crude grades, raising expectations that more Indian end-users could
switch their focus to Southeast Asian supplies, Platts reported.
BPCL was said to be seeking up to one
million barrels of various Southeast Asian light sweet crudes, including
Malaysia’s Miri Light, Labuan, Tapis, Kikeh, Kimanis and Bintulu as
well as Brunei’s Seria Light and Champion crudes for loading over
September 11-20, according to an official tender notice seen by S&P
Global Platts.
According to the latest shipping fixtures
seen by Platts, India Oil Corporation fixed Olympic Sky and Seafalcon
to move a total of about 1.2 million barrels of Malaysian Labuan crude
for loading in July, while BPCL fixed Nordic Jupiter, Mare Siculum, Shah
Deniz and Pavino Spirit to move around one million barrels each of
light sweet Kikeh and Kimanis crudes for loading in July.
The tender closes July 22, with validity
until July 26. The latest spot tender raised a few eyebrows in the
Asia-Pacific sweet crude market, as the Indian state-owned company does
not regularly seek Malaysian and Bruneian crude grades in the spot
market.
However, BPCL’s latest move was seen as
necessary, as the procurement of any Nigerian crude grades would be a
big risk amid ongoing production hiccups caused by militant attacks in
the Niger Delta, a company source said Tuesday.
“BPCL, like many other Indian state-run
companies, prefers to take Nigerian light sweet crudes like Qua Iboe and
Bonny Light. Those are the number one choices,” the source said, adding
that “when production [of light sweet Nigerian grades is] in doubt, the
next best option would be Malaysian (grades).”
Late last week, Mobil Producing Nigeria, a
subsidiary of ExxonMobil, said Nigerian crude grade, Qua Iboe, had been
placed under force majeure and exports were halted, while Italian
company Eni confirmed earlier this month that 4,000 barrels per day of
oil equivalent of equity production had been shut in following an attack
claimed by Nigerian militants in the Niger Delta.
Nigerian militant group, the Niger Delta
Avengers, said Friday that it would not permit foreign oil companies
operating in the Niger Delta region to carry out repairs on bombed oil
pipelines, threatening more devastating attacks on any repaired
facility.
“There is no guarantee the Nigerian
crudes will load and set sail safely. It’s very risky,” said a
Singapore-based sweet crude trader.
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