Abu Dhabi National Oil Co may begin long-term naphtha sales negotiations with buyers in Asia as early as next week, according to three people with direct knowledge of the situation.
Marketing executives from Adnoc, as the company is known, and buyers of the fuel will start discussions in Singapore February 7 that may culminate in an initial offer by the end of the week, according to the people who asked not to be named since talks will be confidential. The naphtha is for delivery from April through March. A spokesman for Adnoc declined to comment on the talks.
Arabian Gulf oil producers like Abu Dhabi sell most of their crude and refined products under long-term contracts. Naphtha, used in making petrochemicals and gasoline, is mainly sold under annual contracts.
The state-run producer in the capital of the United Arab Emirates offers term cargoes starting from January, April and July for the following twelve months. Last year the company offered naphtha for supply starting from October for the first time.
Adnoc sells three grades of naphtha known as Pentane Plus, Low Sulfur and Splitter. The company secured premiums of $16.50 a tonne to $18.50 a metric tonne above Middle East benchmarks for supply of those fuels from January through December during its last round of term talks in November, traders involved in those negotiations said at the time.
Kuwait Petroleum Corp in October sold Full-Range naphtha at $12 a tonne over Middle East quotes and Light grade at a $13 premium, bidders involved in those discussions said.
In the spot market Kuwait sold 150,000 tonnes of the fuel for February loading at about $19 a tonne above Middle East prices, ICIS reported January 17, citing traders it didn’t identify. Qatar International Petroleum Marketing Co, known as Tasweeq, sold 50,000 tonnes of Full-Range grade for loading in the second half of February at a premium of almost $18 a tonne over benchmark, ICIS said January 20.
The UAE, Kuwait and Qatar are among the twelve members of the Organisation of Petroleum Exporting Countries, which pumps about 40 percent of the world’s crude.For all the latest energy and oil news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.
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