Saudi Sells 2 Yanbu Fuel Oil Lots, Prices Down

Saudi Aramco and Exxon Mobil have sold two parcels of high-viscosity fuel oil for early-December 2009 lifting from the Red Sea port of Yanbu at wider discounts in a weaker market, traders said.

Aramco sold to Cargill 85,000 tonnes of 650-centistoke (cst) fuel oil for 3-5 December 2009 loading from its joint venture Samref refinery with Exxon at US$23-US$24 per tonne below Singapore spot quotes, on a free-on-board (FOB) basis.

Exxon sold a similar 80,000-to-90,000-tonne parcel for 8-10 December 2009 lifting from the same port to Middle East trader FAL Oil at an undisclosed price.

Traders said the deal could have been done at a wider discount of around US$30 per tonne, FOB.

These levels transacted are much lower than the US$15-US$16 per tonne below Singapore spot quotes, FOB, that local trader Kuo Oil paid for a similar cargo loading on 10-12 Nov 2009.

Asian fuel oil fundamentals have softened over the last 1-1/2 months, as rising supplies from the Middle East and the West outpaced steady regional bunker demand. Saudi Arabia has sold at least 500,000 tonnes of November 2009 loading spot cargoes so far, after exporting more than 1 million tonnes in October 2009. - Kuwait Times