Bharat Petroleum Corp buys rare Urals in tender

Singapore, Jul 11: Bharat Petroleum Corp. (BPCL) has taken a rare cargo of August Russian Urals crude via its monthly tender, significantly cutting its spot imports compared to its previous three tenders, a company source said on Tuesday.

State-run refiner BPCL bought 600,000 barrels of Urals in its tender, compared with more than 2 million barrels of West African and Middle East grades in its previous tender.

The refiner bought the Urals cargo from European trader Vitol, the source said, but declined to comment on the level fetched.

''We are covered with our term contracts. Our requirements vary from time to time,'' the source said.

BPCL bought 2.05 million barrels of August cargoes, including 1.1 million barrels of Middle East crude last month, adding to the 1.5 million barrels of August-loading Middle East crude in late May, which may explain the limited requirements this time.

The refiner had been boosting its imports via its past tenders, buying 2.8 million barrels in late May, and 2.2 million barrels in early May, after having skipped a tender in April when oil prices rocketed to the then record-high of .35 a barrel.

Global benchmark U.S. crude jumped to a fresh record of .78 on Friday.

BPCL was not seen buying Urals crude through tender for at least over a year, but it was not the first time the refiner had chosen grades other than its usual Middle Eastern or West African slates.

It bought last month 950,000 barrels of Nigeria's new Ehra crude, which came on stream in March, as well as Azeri Light crude on two occasions last year.

The narrow Brent-Dubai Exchange of Futures for Swaps (EFS) has made Urals, which is priced off Brent, attractive when compared to Middle East sour benchmark Oman crude, which is priced off Dubai crude.

China's Unipec bought at least 4 million barrels of Urals crude for August loading last month after the EFS fell below .00 a barrel.

The August EFS stood at .30/4.35-a-barrel on Tuesday morning.

BPCL had been increasing its crude purchases after ramping up capacity at its Mumbai plant, which now stands at 240,000 barrels per day (bpd).

Its total crude imports for this fiscal year, from April 2006 to March 2007, would be up to 13 million tonnes (260,000 bpd) against 11 million tonnes for the previous year, BPCL's chairman Ashok Sinha said this week.

The refiner also imports crude oil for its subsidiary Kochi Refinery .

REUTERS