Petroliam Nasional Bhd., Malaysia’s state oil company, reduced the price-adjustment factor for its flagship Tapis crude for the first time in six months as the profit from making diesel declines.
Petronas, as the Kuala Lumpur-based company is known, set the so-called alpha at $5.80 a barrel for March shipments, according to an official who asked not to be identified because of internal rules. It was $6.10 for February, the highest in seven months, and averaged $6.65 in 2012.
Refiners’ profit from producing gasoil, or diesel, has decreased, curbing demand for low-sulfur or “sweet” crudes such as those produced in Malaysia. Gasoil’s premium to Asian marker Dubai crude was at $19.50 a barrel today, according to Bloomberg fair value curves. The so-called crack spread has narrowed 6.3 percent so far this month. It gained 8 percent in February to cap a second monthly increase.
Petronas includes the Tapis adjustment factor in its monthly calculations of official selling prices. The formula is tied to Brent produced in the North Sea, a benchmark grade for Europe, the Mediterranean and Africa.
To contact the reporter on this story: Yee Kai Pin in Singapore at email@example.com
To contact the editor responsible for this story: Alexander Kwiatkowski at firstname.lastname@example.org