A number of Indian state-owned refiners have been picking up Malaysian oil cargoes for loading in July and August.
This is coming during increasing uncertainty over the exports of Nigeria’s crude grades, according to regional sweet crude traders.
India’s Bharat Petroleum Corporation Limited,BPCL has issued a spot tender to purchase several Malaysian light sweet crude grades, increasing the uncertainty.
BPCL was said to be 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 tender closes July 22, with validity until July 26. The latest spot tender 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 said Tuesday.
“BPCL, like many other Indian state-run companies, prefers 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).”
“There is no guarantee the Nigerian crudes will load and set sail safely. It’s very risky,” said a Singapore-based sweet crude trader.