SINGAPORE: Singapore trader Hin Leong has sold 50,000 barrels of gasoline in the Singapore cash market, traders said here the other day, expressing surprise because the firm does not normally trade gasoline.
Hin Leong, which mainly trades fuel oil and middle distillates, sold the 92-octane grade gasoline cargo to Unipec at $73.60 a barrel.
The cargo is for July 26-30 loading from any ports in either Singapore or Malaysia approved by pricing agency Platts.
“I do not recall seeing Hin Leong in the gasoline cash market (before),” said a veteran oil trader based in Singapore.
The price for the cargo was the lowest fetched by a seller for a 92-octane grade in the Singapore cash window since April 15, likely due to a sharp drop in Brent crude prices.
“This came as a surprise but it adds to market liquidity,” said a trader, referring to the sale.
Traders added that if Hin Leong continued to participate in the market, there would be more bid and offer options, depending on Hin Leong’s position.
It was unclear why the family-owned firm, which also owns tanker fleets and a storage terminal, was moving into the gasoline market. It currently does not have any traders hired for the sole purpose of trading the motor fuel, traders said.
Gasoline is, however, experiencing an unusual bull run due to India’s import spree following a supply shortfall caused by refinery maintenance.
State-owned Indian Oil Corp (IOC) has bought more than 500,000 tonnes of gasoline for March to July delivery while Hindustan Petroleum Corp Ltd (HPCL) has bought more than 200,000 tonnes of the fuel for May to July delivery.
China’s growing demand has also affected its gasoline exports, traders said.
The outright price for gasoline, which used to be mostly below that of gasoil, has surpassed the price for benchmark 500ppm gasoil for most of this year due to demand.
