Bloomberg News

Sabic Buys Naphtha in Europe; Jet Fuel Declines: Oil Products

November 23, 2011

Nov. 23 (Bloomberg) -- Saudi Basic Industries Corp. purchased a cargo of naphtha in northwest Europe at a lower price than the last reported deal in the market a month ago. Morgan Stanley bought gasoline barges.

Gasoil on London’s ICE Futures Europe exchange dropped. The fuel’s crack, or premium to Brent crude, widened by 6 cents a barrel. Jet fuel barges fell while diesel was little changed.

Light Products

Sabic bought the 12,500-ton naphtha consignment from Morgan Stanley at $842 a metric ton, priced for delivery to Rotterdam, according to a survey of brokers and traders monitoring the Platts pricing window, which ends at 4:30 p.m. London time. That compares with the last trade at $888 on Oct. 21.

Naphtha’s discount to Brent expanded to $11.66 a barrel from $11.52 yesterday, according to PVM Oil Associates Ltd., a crude and products broker in London.

Gasoline barges for immediate loading in Amsterdam- Rotterdam-Antwerp traded twice at $889 a ton, according to a survey of traders and brokers monitoring the Argus Bulletin Board. That compares with yesterday’s deals at $892 to $903.

BP Plc and Chevron Corp. were the sellers. The trades are for Eurobob grade to which ethanol is added to make finished fuel and are typically for lots of 1,000 or 2,000 tons.

Gasoline’s discount to Brent widened to $1.20 a barrel from 77 cents yesterday, according to PVM.

Middle Distillates

BP purchased a jet fuel cargo from Morgan Stanley partly priced at a premium of $71 a ton to December gasoil for delivery to Le Havre in France, according to the survey of Platts. That compares with a trade on Nov. 21 at a premium of $77.

Royal Dutch Shell Plc bought a barge of jet fuel from Air France-KLM at a premium of $57 a ton to December gasoil, down from deals yesterday at $63, according to the survey.

Diesel barges traded at premiums of $19 to $24 a ton to gasoil futures, the survey showed. That compares with trades yesterday at $17 to $23.

Gasoil barges traded at premiums of $3 to $8 a ton to ICE gasoil, it showed. That’s $1 lower than yesterday’s deals at $4 to $9 more than the futures contract. Gunvor Group sold a heating oil cargo to Diersch & Schroder GmbH at a premium of $12 to the futures contract for delivery to Kiel in Germany.

Gasoil for December shed 0.7 percent to $945.25 a ton as of 5:21 p.m. London time on the ICE exchange. The contract for January also lost 0.7 percent to $937.25 a ton.

The fuel’s crack, a measure of refining profitability, increased to $18.89 a barrel from $18.83 at 4:30 p.m. yesterday, according to ICE data. Front-month Brent decreased 1 percent to $107.99 a barrel on ICE.

Residues

High-sulfur fuel oil barges traded from $609.50 to $615 a ton, the survey of Platts showed. That compares with yesterday’s trades from $613 to $615.50. Low-sulfur changed hands at $638.50 to $639.50 a ton versus $644 yesterday.

Refineries

Total SA will halt half of its processing units at its La Mede refinery in the south of France for major work from Jan. 11 to March 21, the company said. The plant has the capacity to process 157,000 barrels of crude a day, according to data compiled by Bloomberg.

--With assistance from Claire Borchers in London and Tara Patel in Paris. Editors: Raj Rajendran, Rob Verdonck.

To contact the reporter on this story: Nidaa Bakhsh in London at nbakhsh@bloomberg.net

To contact the editor responsible for this story: Stephen Voss at sev@bloomberg.net


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