Bloomberg News

BP Buys Four Europe Diesel Cargoes; Gasoline Gains: Oil Products

March 13, 2012

BP Plc bought four cargoes of European diesel worth at least $96.2 million and purchased eight barges of the fuel. Gasoline barges advanced to a 10-month high.

The Antwerp (BEANCRUD) oil refinery in Belgium, which Gunvor Group Ltd. agreed earlier this month to buy from insolvent Petroplus Holdings AG, may resume operations by the end of April, according to a union official.

Light Products

Gasoline (MOGEEURB) for immediate loading in Amsterdam-Rotterdam- Antwerp traded at $1,127 to $1,133 a metric ton, according to a survey of brokers and traders monitoring the Argus Bulletin Board. That’s the most since May 4 and compares with trades at $1,115 to $1,116 yesterday.

Royal Dutch Shell Plc and BP bought the Eurobob grade, to which ethanol is added to make finished fuel. Total SA, Statoil ASA and Gunvor sold.

The fuel’s crack was at $11.52 a barrel, up from $11.39 the previous session, according to data from PVM Oil Associates Ltd., a London-based crude and products broker.

BASF SE sold a 12,500-ton naphtha cargo at $1,083 a ton. That’s up from trades at $1,076 a ton on March 8. The product’s crack, or discount to Brent, widened to $5.94 a barrel from $5.51 yesterday, PVM data showed.

Middle Distillates

Five cargoes of ultra-low-sulfur diesel changed hands, according to a survey of traders and brokers monitoring the Platts pricing window. The consignments traded at premiums of $30 to $40 a ton relative to April gasoil on the ICE Futures Europe exchange. BP bought four shipments and PetroChina Co. purchased one. Vitol sold three cargoes, while Repsol YPF and Neste Oil Oyj vended one each.

The value of BP’s consignments was calculated by Bloomberg using April gasoil futures at 4:30 p.m. London time.

Ultra-low-sulfur diesel barges advanced to $18.50 to $20 more than April gasoil. That compares with a trade at a $15 premium yesterday. BP and Morgan Stanley were the main buyers, while Shell, Vitol and ConocoPhillips were the biggest sellers.

Heating oil barges declined to a discount of $4 a ton relative to April gasoil. The fuel changed hands at parity to discounts of $1.50 to front-month gasoil on March 9. Vitol was the only seller, while North Sea Group and Omneo Trading bought.

Jet fuel barges rose to a $69 a ton premium to April gasoil on ICE, the Platts survey showed. That compares with trades at $66 more than gasoil on March 9. Shell sold to Total and BP.

Shipments of aviation fuel to Europe from Asia and the Middle East are set to drop in March after rising last month, according to reports from five shipbrokers including Delhi-based Interocean Shipping.

A total of 1.1 million tons of jet fuel will be shipped or provisionally booked to Europe this month from India, South Korea and the Middle East, the shipbroker reports showed. That’s down from 1.3 million tons in February.

Gasoil for April climbed $6.75, or 0.7 percent, to $1,035 a ton as of 5:22 p.m. London time on the ICE exchange. The May contract was at $1,037.50.

The gasoil crack, a measure of refining profitability, fell to $12.61 a barrel at 4:30 p.m. versus $12.74 yesterday. Brent advanced 0.8 percent to $126.34 a barrel.

Fuel Oil

High-sulfur fuel oil traded at $719 to $723 a ton, versus $705.50 to $708 a ton yesterday, the Platts survey showed.

Refineries

Petroplus’s Antwerp plant may restart within six weeks, the official said, declining to be identified because the official is not authorized to speak publicly about the matter. Patrick d’Ancona, a spokesman for Gunvor based in London, declined to comment.

European refiners may reduce processing rates as rising crude prices erode profits, analysts at JBC Energy GmbH said in an e-mailed note.

“We would not be surprised to see run cuts over the coming months, even as maintenance takes around 1.3 million barrels a day of refining capacity offline” this month, JBC said.

To contact the reporter on this story: Lananh Nguyen in London at lnguyen35@bloomberg.net

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


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