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| Iran fuel oil exports stood at 300KT for 2nd straight month |
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 Iranian fuel oil inflows to East Asia are expected to stay at current levels of 300,000 tons for September, traders said.The National Iranian Oil Co. (NIOC) has told its Asian buyers that September-loading cargoes, straight-run 280-centistoke (cst) parcels from Bandar Mahshahr, will be limited to two to three 80,000-ton lots for its term customers, similar to August-loading volumes. “Avails will be the same as for August-loading, meaning the market will probably remain tight from now through September at least,” a Singapore-based Asian trader said. Iranian arrivals into East Asia, which had been heavy up till last month, has kept what could have been an intensely-tight market balanced in terms of both quantity and quality over the past three months. In June, record-high volumes from the country, totalling more than 1 million tons, landed in Singapore, while another 600,000-650,000 tons arrived last month. The monthly average has been 550,000-600,000 tons, up from 300,000-350,000 tons last year. Most of the Iranian volumes were also better-than-specification 380-cst, supporting the market’s quality balance, in an environment where traders typically import raw high-viscosity, high-density parcels and blend them to specification, mainly into 380-cst for Singapore’s marine fuels market, the world’s largest. The cargoes have been arriving into East Asia on board Very Large Crude Carriers (VLCCs) since the third quarter of last year, as combinations of the straight-run grade and low-density, low-water 380-cst from NIOC’s Bandar Abbas refinery. While volumes from Bandar Abbas are unaffected by the natural gas supply disruption, the lack of straight-run cargoes meant there are insufficient supplies overall to fill a VLCC. The shortage has also impacted on the Fujairah marine fuels market, which currently lacks on-specification 380-cst, forcing players to pay high premiums for ready-made cargoes. An Indian semi-term tender, for four cargoes over the August-November period, was awarded to an unusual Middle East player, Gulf Petrochem, at higher prices and opened a rare arbitrage from east coast India to the United Arab Emirates. It has also increased the competition between Singapore-based players and their Middle East counterparts, who have freight advantage over cargoes that originate from the region, reducing inflows into East Asia. August inflows from the Middle East are at 600,000-650,000 tons, down by about 50 percent from a month ago, while Indian arrivals are about 25 percent lower at 200,000-250,000 tons, Reuters data show. Squeezing the market further, Western arbitrage cargoes for September-arrival are expected to stay at below-average levels for a fourth consecutive month, with about 2.1-2.2 million tons booked so far. The West-to-East arbitrage window for European cargoes has been notionally-closed for over two weeks, amid a steeply backwardated Rotterdam barge market that has seen its prompt timespreads hit consecutive three-year high levels. (Source: Reuters)   Socialize this Subscribe to our RSS feed to stay in touch and receive all of TT updates right in your feed reader
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| Last Updated on 06 August 2011 13:57 |