Home / Commodities / Freight News / Brazil turns to Europe for second LSFO cargo for power generation

Brazil turns to Europe for second LSFO cargo for power generation

Brazilian oil company Petrobras has turned to Europe to a buy a second low sulfur fuel oil cargo as power generation feedstock as it struggles to import LNG and with low rainfall affecting hydropower output, traders said.

A cargo with 40,000-45,000 mt of 1% LSFO is expected to load in the west Mediterranean in the middle of November, taking the total volume of LSFO drawn from Europe to Brazil to around 90,000 mt. The previous cargo arrived on the Stena President, dwt 65,000 mt, into the Brazilian port of Suape on October 28, according to cFlow, Platts trade flow software.

The vessel for second cargo has yet to be named and the seller was unavailable for comment.

An ongoing drought and low rainfall has combined with maintenance at a key LNG import facility to necessitate oil imports for power generation, as hydropower is critical for electricity generation in Brazil.

When the first LSFO cargo was drawn in early October the European LSFO complex was particularly tight due to refinery maintenance. However, the Mediterranean complex is now more balanced and inquiries have been few and far between this week, a source said Thursday.

“This [fixture] has kept the market slightly balanced because it’s decent volumes especially with 1% Med/North coming off,” a trader said.

The fixture of an import cargo to Brazil comes as a shock as Petrobras offered a 50,000 mt LSFO export cargo with options to discharge into Europe for a November 14 laycan at the end of October.

Trans-Atlantic fixtures of oil products such as gasoline and vacuum gasoil are common, but are rare in the LSFO market and particularly so to Brazil, historically a net exporter of LSFO capable of delivering up to 120,000 mt/month.

Petrobras was unavailable for comment.
Source: Platts

Leave a Reply

Your email address will not be published. Required fields are marked *

*

captcha

Please enter the CAPTCHA text

Recent Videos

Hellenic Shipping News Worldwide Online Daily Newspaper on Hellenic and International Shipping