Bangladesh gets lower than term deals in fuel oil tender

Bangladesh Petroleum Corp (BPC)
has received offers in its first tender to buy fuel oil at
premiums lower that its term deals, two company sources said on
Sunday.

The tender was issued as part of an effort to move away from
direct-term deals with fuel products suppliers to try to buy at
cheaper rates.

A total of nine international oil and trading companies have
been competing to win the tender for 160,000 tonnes of
180-centistoke high sulphur fuel oil. The tender closed on July
20 and is valid till Oct. 2.

Vitol came up with the lowest offer of a premium of $15.80 a
tonne to Singapore spot quotes, while the state-owned BPC
imported fuel oil in the first half at a premium of $24 in term
deals with companies.

“Vitol will get the tender if all other papers submitted by
them fulfil terms and condition set out by the tender,” one
source said, adding that other documents were being scrutinised.

The tender was for delivery between August and December.

A shortfall in supplies of natural gas has forced Bangladesh
to burn oil, a more costly option, to generate electricity.

In February, BPC issued its first tender to buy oil products
in 15 years when it sought more than 11 million barrels of
diesel and jet fuel and managed to buy at lower rates than its
term deals.

(Reporting by Ruma Paul; Editing by Himani Sarkar)

The article Bangladesh gets lower than term deals in fuel oil tender was originally published at Reuters - US Energy.