Kuwait Sends Over 2 Mln Bbl of Distillates to West of Suez for July Delivery
Kuwait started exporting jet fuel and gasoil ahead of the initial U.S.-Iran peace agreement signed on June 18, with national oil company Kuwait Petroleum Corp. moving over 2 million bbl of these products on vessels through the Strait of Hormuz since the beginning of the month, according to ship-tracking platform Kpler.
The latest vessel to exit the Middle East Gulf region via the Strait, on Wednesday, was the 73,604-dwt vessel Alora, which was loaded with 374,942 bbl of gasoil and 127,822 bbl of jet fuel from Mina Al-Ahmadi refinery around mid-March. The vessel’s cargoes are destined for Djibouti, with an estimated arrival date of July 1.
In addition to the Alora, KPC has also moved cargoes to Europe on the following vessels:
· The 46,320-dwt Bubyan, loaded with 330,574 bbl of jet fuel from Al-Zour Refinery on June 6 and destined to Europe with an estimated discharge date of July 14. It could not be determined when Bubyan transited the Strait of Hormuz as its Automatic Identification System was switched off.
· The 109,999-dwt Stemnitsa, loaded with 743,166 bbl of jet fuel from Mina Al Ahmadi and Mina Abdullah refineries in late February to early March. It exited the Middle East Gulf via the Strait of Hormuz on June 11 to deliver the cargo to Rotterdam, with an estimated arrival date of July 21.
· The 109,719-dwt Al Dasma, loaded with 741,304 bbl of jet fuel from Mina Abdullah refinery on Feb. 28 and transited the Hormuz Strait on June 1. It is scheduled to discharge the cargo to La Havre, France on July 2.
KPC lifted all force majeure notices, issued during the Iran war, late on June 18.
Wider price spreads for gasoil and jet fuel between Asia and Northwest Europe likely incentivized KPC to send its volume westward rather than towards Asia.
The gasoil front-month East-West Exchange of Futures for Swaps values started trending into the discounted region starting June 3, and remained at discounts larger than $35/mt from June 11 to date, according to OPIS data. A discounted EW EFS value indicates that Northwest European prices are likely higher than Asian prices.
The jet fuel front-month East-West values fell into discounts of around $30/mt and deeper from May 25 to May 29 before recovering, according to data provided by market sources. The EW values then fluctuated before softening on June 15 and have remained at discounts larger than $35/mt to date.
According to Kpler, around 82 oil tankers have crossed the Hormuz Strait, sending crude and oil product barrels out of the Middle East Gulf following the interim peace agreement signed in Versailles.
—Reporting by Thomas Cho, tcho@opisnet.com and Kite Chong, kchong@opisnet.com; Editing by Mei-Hwen Wong, mwong@opisnet.com