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Bloomberg: Asian Fuel Oil Climbs to a Record; BP Buys a Cargo (Update1)

By Sophie Tan

Oct. 23 (Bloomberg) — Asian benchmark 180-centistoke fuel oil gained $6 a metric ton, or 1.1 percent, to a record $458 in Singapore, Asia’s biggest oil-trading center, according Bloomberg data. BP Plc bought a cargo for mid-November loading.

The price of 380-centistoke fuel oil, mainly used as marine fuel, climbed $6.50, or 1.5 percent, to an all-time high of $447 a ton. Royal Dutch Shell Plc and PetroChina Co. bought a cargo each.

Dubai crude for December delivery rose 40 cents, or 0.5 percent, to $78.44 a barrel, according to Bloomberg data. Prices have risen 38 percent this year.

Fuel oil’s discount to Dubai crude oil, known as the crack spread, narrowed to $7.43 a barrel from $7.96 a barrel, according to Bloomberg data. The differential is a measure of profit or loss from processing Dubai crude.

Fuel oil transactions on oil-pricing service Platts’ trading system:

BP Plc bought a cargo of 180-centistoke fuel oil from Hin Leong Trading at a premium of $2.50 a ton over the average Singapore fuel oil assessments by Platts for loading between Nov. 18 and Nov. 22.

Royal Dutch Shell Plc bought a cargo of 20,000 tons of 380-centistoke fuel oil from Hin Leong Trading Pte for loading between Nov. 18 and Nov. 22 at a premium of $2 a ton. Vitol Group sold to PetroChina Co. 20,000 tons of 380-centistoke fuel oil at a premium of $3 a ton for loading between Nov. 12 and Nov. 16.

                                          Spot Prices
=============================================================
Singapore                                 ($/metric ton)
————————————————————-
                                   Bid       Offer     Change
180-centistoke Fuel Oil
  – 2 percent sulfur grade         467.50    468.50      6.00
  – 3.5 percent sulfur grade       457.50    458.50      6.00

380-centistoke Fuel Oil            446.50    447.50      6.50
The oil’s centistoke rating is a measure of its viscosity, or flow rate, when heated. Fuel oil with a higher centistoke rating has a slower flow rate and requires further blending with other fuels to lower the rating. The main viscosity rates for bunker fuels are 380-centistoke and 180-centistoke.

To contact the reporter on this story: Sophie Tan in Singapore at [email protected] .

Last Updated: October 23, 2007 06:37 EDT

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