File Photo: Crude Oil
By Sebastine Obasi, with agency reports
India’s Bharat Petroleum Corporation Limited,BPCL has 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 amid growing uncertainty over the exports of Nigerian crude grades.
BPCL is 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.
The latest spot tender is said to have 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.
“BPCL, like many other Indian state-run companies, prefer 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).”
Last week, ExxonMobil said Nigerian crude Qua Iboe has been placed under force majeure and exports were halted, while Italian company, Eni, confirmed earlier this month that 4,000 barrels per day, b/d, of oil equivalent of equity production had been shut-in following an attack claimed by militants in the Niger Delta. Nigerian militant group, the Niger Delta Avengers, said weekend 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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