Vitol has won a tender to supply India Oil Corporation (IOC) Limited with crude oil, but other trading was limited on Thursday as differentials rose and some buyers baulked at higher prices.
The world's largest oil trading firm won at least part of a tender to supply Indian refiner, IOC, with crude. IOC purchased four million barrels, traders said, with Vitol getting at least two million. The grades in the award were not immediately clear.
In Nigeria, sellers continued to offer light crude cargoes at higher prices, particularly grades such as Forcados or Bonga that could replace North Sea Forties.
As a result, Qua Iboe was offered as high as $1.95 per barrel above dated Brent, and Bonga at premiums up to $1.60 and Forcados as high as $1.80 per barrel.
While some buyers said these differentials could work, others said European buyers were more likely to take either Libyan or Algerian crude, which is closer, or U.S. crude, which is priced against cheaper WTI futures. Roughly 25 cargoes were left to trade.
The global oil market will likely show a surplus in the first half of 2018, as rising U.S. supply offsets OPEC’s discipline in maintaining its production cuts for the whole of next year, the International Energy Agency said.
M&P, Agency Report