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BP Buys Jet Fuel in Europe; Lukoil Sells Diesel: Oil Products

BP Plc bought jet fuel barges at higher premiums in northwest Europe. Diesel spreads were little changed even as Litasco, OAO Lukoil’s trading arm, sold.

Gasoil on the ICE Futures Europe exchange surged as Brent crude rose. Contracts of the front-month and second-month gasoil were at parity after trading in contango yesterday.

Light Products

Gasoline (MOGEEURB) for immediate loading in Amsterdam-Rotterdam- Antwerp traded at $967 to $974 a metric ton, according to a survey of brokers and traders monitoring the Argus Bulletin Board and Platts pricing window. That’s the most since Oct. 17 and compares with deals yesterday at $957 to $968. The trades are for Eurobob grade to which ethanol is added to make the finished blend.

The fuel’s premium to Brent widened to $3.57 a barrel from $3.38 yesterday, according to data from PVM Oil Associates Ltd., a crude and refined products broker in London.

Naphtha’s discount to Brent widened 6 cents to $6.44 a barrel, PVM data show.

Kuwait Petroleum International Ltd., a unit of Kuwait Petroleum Corp., sold three naphtha cargoes of 26,000 tons each, from its Milazzo plant in Italy for loading Jan. 8 to Jan. 10, Jan. 15 to Jan. 17 and Jan. 23 to Jan. 25, a company official said, declining to be identified because he’s not authorized to speak on the matter. Two of the cargoes will be shipped to Asia, while one will remain in the Mediterranean, he said.

Middle Distillates

BP purchased the jet fuel from Statoil ASA and Koch Industries Inc. at premiums of $59 and $60 a ton to February gasoil, according to the survey of the so-called Platts window, which ends at 4:30 p.m. London time. That compares with yesterday’s deals at a $58 premium to January gasoil.

Diesel barges traded at premiums of $20 and $21 a ton to February gasoil, the survey showed. That compares with deals yesterday at premiums of $21 to January futures. ConocoPhillips was the biggest buyer.

Gasoil for January climbed 1.8 percent to $976.25 a ton at 4:57 p.m. London time on the ICE exchange. The more actively traded contract for February increased 1.7 percent to $976.25, moving the contracts to parity. Earlier today, the contango was at $1.75, the most since the end of July.

Contango is a price structure to describe a situation where later-dated deliveries are more expensive than nearer supplies. The reverse is known as backwardation.

Gasoil’s crack rose to $17.19 a barrel from $16.83 at 4:30 p.m. yesterday, according to ICE data. That’s the highest spread since Dec. 8. Front-month Brent advanced 1.2 percent to $113.77 a barrel on the ICE exchange.

Barges (HEATAAAA) of heating oil traded at a premium of $1 a ton to January futures, according to the survey of Platts. That compares with deals at parity yesterday.

Residues

High-sulfur fuel oil traded at $677.50 to $686.75 a ton, according to the survey of Platts. That compares with yesterday’s deals at $661.50 to $673.50.

To contact the reporter on this story: Nidaa Bakhsh in London at nbakhsh@bloomberg.net

To contact the editor responsible for this story: Stephen Voss at sev@bloomberg.net

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