Indonesia's Pertamina has bought by tender 400,000 barrels of high-sulphur gas oil for delivery in late August, a trade source said on Monday. The state oil and gas firm purchased 200,000 barrels of 0.35 percent gas oil from Petral at a premium of $2.60 a barrel to Pertamina's price formula, on a cost-and-freight (C&F) basis.
The cargo was for delivery into Tanjung Uban on August 28-30. Pertamina also bought a similar cargo from PetroChina at a lower premium of $1.30 a barrel, C&F, for delivery into Wayame on the same dates. Prior to this tender, Pertamina bought 800,000 barrels of similar grade gas oil at premiums of $1.85-$2.10 a barrel for August delivery.
Pertamina is expected to lower diesel imports to 6.2 million barrels in August, a company official had said earlier, from 7.2 million barrels in July. Still, the volumes are well above monthly average imports of 5-6 million barrels.
Indonesia raised fuel prices by an average of nearly 30 percent in May in a bid to cut its huge fuel subsidy bill, but the country still has some of the lowest fuel prices in Asia and consumption is expected to increase next year.
Despite the hike, officials say domestic prices still do not reflect global levels and will not discourage consumption. Pertamina has nine refineries scattered around the archipelago with a combined capacity of around 1 million barrels per day. But it only supplies 70 percent of domestic oil consumption, while the balance is met through imports.