Indonesia drops fuel oil in November product buy tender

Indonesian state oil company Pertamina has issued a tender to buy oil products for November delivery, traders said on Wednesday.

They said the monthly tender, for the first time, did not include fuel oil.

This was to be expected because of the processing they are doing at Shell and also they have bought quite a lot recently," one trader said.

Pertamina signed on Monday an agreement with Shell Singapore to process 50,000 barrels per day (bpd) of Arabian Light crude which would see Indonesia lifting about 650,000 barrels of fuel oil every month.

Indonesia normally buys around one million barrels of fuel oil per month but had purchased 1.6 million and 1.4 million barrels in September and August, respectively. It bought one million barrels in October.

The product tender seeks gasoline, jet fuel, gas oil and industrial diesel oil in quantities ranging from 100,000 to 600,000 barrels each, traders said.

It seeks all grades of gasoline on a free-on-board (fob) Singapore basis and 0.5 percent sulphur gas oil, industrial diesel and jet fuel of DERD 2494 grade on either a delivered basis to Teluk Semangka or Situbondo in Java, or on an fob Singapore basis.

The tender closes on October 6, but no validity date was specified, traders said.

For October delivery, traders said Pertamina had so far bought 800,000 barrels of gasoline and was seeking another 400,000 barrels. It purchased 4.2 million barrels of diesel and 1.8 million barrels of kerosene. (*)