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Taiwan buys Angolan crude oil, may replace Iranian

Saturday, 25 February 2012 | 00:00
Taiwan state-owned oil refiner CPC Corp bought 6 million barrels of Angolan crude in what traders said was one of its biggest tender purchases for years and could be partly to replace Iranian oil.
Taiwan imported slightly more than 30,000 barrels per day (bpd) of Iranian crude oil last year, the equivalent of about one cargo or almost 1 million bpd per month.
Iran faces an embargo on its oil from the middle of this year and many Asian countries have been trying to find alternative sources of oil.
Taiwan is also a big importer of West African crude oil and usually takes around 140,000 bpd a month from the region. That is the equivalent of two very large crude carriers (VLCCs) or more than one sixth of the Asian island's daily consumption.
"It could be related to Iran," said one crude oil trader in London. "It is not clear but it would make sense."
Light Angolan and Iranian crude oil are both relatively light but Iranian crude has a much higher content of sulphur, a corrosive contaminant.
Thursday's tender purchase involved the sale of 3 million barrels of Angolan Nemba crude, 2 million barrels of Cabinda and 1 million barrels of Palanca crude to be delivered in three VLCCs in May, traders said.
Angolan state oil producer Sonangol sold 2 million barrels of Nemba and 1 million of Palanca, Chinese-owned Unipec, a division of top Asian refiner Sinopec, sold 1 million barrels of Nemba and 1 million of Cabinda.
U.S. company Conoco sold 1 million barrels of Cabinda, traders said.
None of the companies reported to be involved in the tender offered to comment on the purchases or discuss prices.
"I can't remember CPC ever buying so much crude in one go," said a trader at one large Asian oil company.
Most crude oil traders had expected CPC to buy a total of 2-4 million barrels in one or two VLCCs, as it had done previously.
Angola's Cabinda and Nemba grades have sold recently at a premium above the North Sea crude oil benchmark of $1.20 to $1.50 per barrel for lifting at Angolan ports.
Based on Thursday's spot market, that would translate into a price of around $123 per barrel fob and considerably more on a delivered basis.
Source: Reuters
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