PSO buys 55,000 tonnes gasoil after term cargo delay
SINGAPORE: Pakistan State Oil bought 55,000 tonnes of gasoil for loading this week after its term supplier delayed a cargo to the company, at a time when domestic gasoil stocks are low and demand has increased, industry sources said on Monday.
Pakistan bought one of two gasoil cargoes that it had initially sought, for loading over Aug 28-30, from trader Vitol at a premium of about $5.95 a barrel above Middle East quotes, one of the sources said.
The company had initially requested two cargoes as its long-standing term supplier Kuwait Petroleum Corp (KPC) had rescheduled a late-August cargo to October.
“As Pakistan gasoil stocks are very low, (PSO) asked for two cargoes just to be on the safe side,” the source added.
Problems at a desulphuriser unit at one of Kuwait Petroleum Corp’s refineries could likely have caused the term cargo to be delayed, industry sources said.
But this could not be confirmed. KPC officials could not immediately be reached for comment.
KPC is expected to resume normal term supply of gasoil to Pakistan in early September. PSO is contracted to buy around 3 million tonnes of gasoil from KPC this year.
In May, KPC had to delay some gasoil cargoes to Pakistan due to rising domestic demand ahead of peak summer demand and problems in secondary refinery units.
It is unclear if the two refinery issues are related.
The delay comes at a time when below-average rains have curbed hydropower generation in Pakistan, boosting agricultural demand for diesel to power irrigation systems.
Pakistan State Oil is separately seeking 305,000 tonnes of gasoil for delivery over September to December, making its spot requirements for gasoil its largest in more than a year.
Pakistan needs to buy gasoil due to the non-availability of hydropower and a gas shortage faced by power plants, industry sources have said.