PSO seeks 780,000T LSFO

SINGAPORE (Reuters) - Pakistan State Oil (PSO) issued a tender seeking up to 780,000 tonnes of high-sulphur fuel oil (LSFO) for March to April delivery, up from its previous tender requirement and over a shorter timeframe, traders said on Friday.
The requirement, for 10 firm cargoes of the 180-centistoke (cst) grade, of 65,000 tonnes each, and another two optional parcels, signals that power-generation demand has recovered after it had bought less-than-usual volumes for November and December.
“It’s safe to say that Pakistan’s requirements are back to normal, if not a tad on the heavy side,” a Singapore-based Middle East trader said.
“Their 2010 volumes are expected to be about 5-10 percent more than last year due to additional power-generation capacity coming up.”
The tender for the parcels, for delivery to Karachi on a cost-and-freight (C&F) basis, closes on Feb. 9 and will remain valid till Feb. 12.
PSO last bought up to 585,000 tonnes of the high-sulphur fuel oil, for January-March delivery, and another 360,000 tonnes of low-sulphur fuel oil for February-April, all of which are for power generation.
In November and December, PSO imported only 300,000-500,000 tonnes, down from average monthly levels of some 600,000 tonnes, due to high inventories, which resulted from lower demand from the country’s power plants. The high-sulphur cargoes were purchased from Middle East traders FAL Oil and Bakri at premiums of $21.00-$24.00 a tonne to Middle East spot quotes, C&F.
PSO typically awards its tenders to Middle East-based suppliers who have freight advantage over Singapore sellers and competes with the Fujairah marine fuels market for cargoes.