SINGAPORE, Nov 2: Pakistan State Oil (PSO) has bought four fuel oil cargoes totalling 220,000 tons for November and December delivery, one less than it had tendered to buy, industry sources said on Wednesday.
Middle East trader Bakri sold two 180-centistoke (cst) cargoes of 55,000 tons each for deliveries during Nov 1-3 and Nov 8-10 to the Port Qasim at premiums of $28 a ton and $29.33 to Middle East spot quotes on a cost-and-freight basis.
Fellow trader FAL sold two optional cargoes of the same size, a 125-cst parcel and a 180-cst lot, for November and December deliveries. The 125-cst parcel was done at a premium of $32.79 a ton while the 180-cst was done at $29.98.
PSO had originally tendered to buy five cargoes, including a firm parcel for Nov 16-18 delivery, but this lot is unlikely to be done, traders said.
PSO last bought four similar cargoes for September-October arrival at lower premiums of $16-$21 a ton for 180-cst parcels and $29.75 for 125-cst parcels.
The higher premiums for the current cargoes are due to tightening regional conditions, which have kept Asian physical cargo premiums for 180-cst above $4 a ton for over a month.
The market is expected to remain tight for most of Nov, with below-average volumes of 1.5-1.6 million tons of Western cargoes landing in East Asia, dealers say.
Pakistan is expected to buy 25 per cent more fuel oil for this financial year, which ends next July, up to 1 million tons due to increased demand from the power sector.
Demand for power in 2005 is expected to be at 15,000-16,000 megawatts, up 858 mw from 2004.—Reuters
