IOC sells two 180-cst fuel oil cargoes

55,000 tonnes of 180-centistoke product could be heading to Fujairah, according to industry sources.

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Updated on 19 Apr 2013 07:35 GMT

Indian Oil Corporation (IOC) has sold two cargoes of 180-centistoke (cst) fuel oil that may be utilized in the Fujairah bunker market, according to industry sources.

The state-owned oil firm is reported to have sold a 30,000-tonne cargo of low viscosity 180-cst product to PetroChina at a discount of $10 per tonne to the Singapore benchmark.

Another 25,000-tonne parcel of 180-cst fuel oil was sold at a discount of $11 per tonne to the Singapore benchmark, traders said.

Earlier this month, another IOC cargo of similar specifications was reportedly sold at a discount of between $5 to $6 per tonne.

Both recently sold cargoes are scheduled to be loaded from the west coast of India towards the end of April, with the 30,000-tonne lot due to be lifted from the port of Kandla.

The 180-cst parcels may be transported to Fujairah - the largest bunker port in the Middle East and a regular purchaser of Indian fuel oil - in order to be used for blending, market sources said.

The Fujairah marine fuels market has been experiencing a supply shortage in recent weeks, which in turn has led to the tight availability of products and made it difficult for local players to supply for prompt dates.

The price margin between 380-cst and 180-cst has also been particularly high during this period. On April 18, a margin of around $70 per tonne was being seen, whereas two months ago, on February 18, the differential was just $27 per tonne, according to Bunker Index price data.

The price of 180-cst bunker fuel in Fujairah was being quoted at $670.00 per tonne on April 18, down $5 on the previous week. The 380-cst price was $600 per tonne on April 18, compared to $626 per tonne on April 11.

IOC operates refineries in Assam, Gujarat, West Bengal, Uttar Pradesh, Madras and Bihar and is the leading provider of fuel oil for the Indian bunker market, supplying both marine fuel and lubricants to customers in all major Indian ports.