Libya Pushes Europe Low-Sulfur Fuel Oil Premium to 26-Month High
Low-sulfur fuel oil’s premium to its more-polluting equivalent rose to the most in more than 26 months amid disruption of exports from Libya.
Libyan rebels were in control of the oil port of Ras Lanuf in the country’s east, Khaled el-Sayeh, a coordinator between the opposition’s military forces and the interim ruling council in Benghazi, said yesterday. The Ras Lanuf facility usually exports about 70,000 barrels a day of fuel oil, mainly the low- sulfur grade, said Christophe Barret, an oil analyst at Credit Agricole CIB.
“It could be that Libya is cutting exports of the fuel,” Barret said from London. Italy may be using more low-sulfur fuel oil in power generation as exports of natural gas from the north Africa nation were halted, Barret said.
Fuel oil containing 1 percent of sulfur traded on March 4 at a premium of $45 to 3.5 percent sulfur bunker fuel, according to data compiled by Bloomberg. That’s the most since December 2008, the data show.
Oil exports from Libya, North Africa’s third-largest producer, dropped by about 50 percent in the week to March 1 as companies including OMV AG closed fields and evacuated workers, according to Zug, Switzerland researcher Petromatrix GmbH. Ras Lanuf had its crude supply interrupted, two officials, who declined to be named, said on Feb. 28.
Libyan crude yields a higher proportion of diesel, jet fuel and gasoline than heavier grades such as Russia’s Urals and Saudi Arabia’s Arab Medium.
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