May 30, 2012 / 9:33 AM / 5 years ago

UPDATE 1-Bangladesh agrees fuel term deals at higher premiums

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By Jessica Jaganathan and Ruma Paul

SINGAPORE/DHAKA, May 30 (Reuters) - Bangladesh Petroleum Corp (BPC) has concluded its July-December term negotiations for gasoil and jet fuel at stronger premiums than its current contract, industry sources said.

Premiums have picked up in the Middle East ahead of peak summer demand.

The company has finalised its gasoil contract for the second half of the year at a premium of $3.80 per barrel over Middle East quotes, up nearly 10 percent from the $3.50 per barrel premium for its January-June contract, and up 15 percent from the same period last year.

The term contract for jet fuel has been fixed at a premium of $4.80 per barrel over Middle East quotes, up from the current $4.50 per barrel, and from $4.30 per barrel over the same period last year.

Suppliers and volumes will remain the same from the first half, the traders said.

BPC, the country's sole oil importer and distributor, is set to import a total of 1.6 million tonnes of diesel, 300,000 tonnes of fuel oil and 164,000 tonnes of jet fuel in the January-June period.

BPC failed to reach an agreement on fuel oil for the second half, however, partly because of suppliers asking for much higher premiums.

"In the second half, we may take some fuel oil cargoes, which was skipped in the first half," a source said.

For the first half, BPC had agreed on its 180-centistoke (cst) fuel oil term contract at a premium of $40.80 per tonne to Singapore spot quotes, sharply up from the $32 per tonne premium for its July to December term cargoes last year.

Suppliers for its middle distillates contracts are Kuwait Petroleum Corp (KPC), Malaysia's Petronas, Egypt's Middle East Oil Refinery, Emirates National Oil Company (ENOC) and Philippines National Oil Company.

Bangladesh also imports fuel oil from Vietnam's Petrolimex and Maldives National Oil Co. (Editing by Chris Lewis)

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