India's BPCL sells its first low sulfur diesel cargo for export
SINGAPORE (Reuters) — Indian oil refiner Bharat Petroleum Corp Ltd sold a low sulfur diesel cargo through an export tender for the first time as its refineries upgrade units and due to higher inventory of the fuel, three industry sources said on Monday.
The state-owned refiner, which was once a net importer of diesel, is typically well-balanced with its diesel stocks and rarely ships the fuel out of the country.
India’s refiners have increased their diesel output and upgraded their plants to meet the new Euro IV fuel standards, which set the sulfur content of diesel at 50 parts per million (ppm), that were adopted in April.
A spike in domestic inventory is also contributing to the rare exports of the fuel, one of the sources familiar with the matter said.
“Diesel demand in September was more than expected, but in October it’s down...so stocks are more,” the source said, adding that monsoon season was still ongoing in certain parts of India.
Monsoon rains typically curb diesel use for irrigation pumps.
While BPCL has exported higher sulfur gasoil grades in the past, this is the first time the refiner is exporting the 50-ppm sulfur diesel grade through a tender, the source added.
BPCL may have one more diesel spot cargo to export in November, the source said.
In its latest tender, BPCL sold a combination cargo comprising 15,000 t of 350 ppm sulfur diesel and 20,000 t of 50 ppm sulfur diesel for loading from Mumbai over Oct. 21 to 25, the sources said.
The cargo was sold to Unipec at a discount of about $1 a barrel to Singapore quotes, they added.
Reporting by Jessica Jaganathan; Editing by Christian Schmollinger
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