PetroIneos importing more W.African crude oil to UK’s Grangemouth

PetroIneos is ramping up imports of West African crude to its Grangemouth refinery in Scotland, according to shipping fixtures, booking at least 5 million barrels since the start of October amid lower prices and technical problems at the plant.

The joint venture between PetroChina and Ineos which runs the 210,000 barrel-per-day plant booked the latest 1 million barrel Suezmax tanker on Thursday, shipping fixtures show, with another four or five listed since the start of the month.

The move may free up more barrels of North Sea Forties crude oil that the refinery normally processes, traders said. Forties supplies can have an outsized influence on world oil prices as it is the biggest of the four streams underpinning the benchmark Brent crude oil future.

At least five Suezmax vessels – the Aegan Horizon, Frio, MT Godavari Spirit, Bouboulina, and Ashkini Spirit – are sailing towards West Africa, AIS Live tanker tracking data on Reuters showed, and are listed as due to load by Nov. 11.

Traders said the refinery may be looking to ship in additional West African crude due to a problem with the Grangemouth refinery’s hydrocracker. Lighter crude grades, like most shipped from West Africa, may be easier to process while the hydrocracker is down.

The refinery’s hydrocracker, which makes distillates such as diesel and jet fuel, has been down for unplanned maintenance for much of this month.

No comment from PetroIneos was immediately available.

Lower prices and ample supply may also be encouraging buying, traders said. Brent crude prices fell to a four-year low last week, with supplies of light-sweet crudes especially high as the shale oil revolution in the United States has reduced demand for imports from West Africa.

PetroIneos imported no crude from West Africa in the first five months of the year, according to shipping fixtures. Between May and September imports have averaged around three cargoes a month. Only one was booked last month.

Nigerian crude oil exports are set to drop to about 1.7 million bpd in December from about 1.91 million in November, shipping lists indicated on Thursday.

Reuters