Business

Pakistan seals Kuwait deal for 2015 gasoil

SINGAPORE: Pakistan has finalised a gasoil supply deal for 2015 with Kuwait, which supplies 90 percent of its demand for the fuel it uses for electricity generation and transport.

Pakistan State Oil Company Ltd finalised the term contract from long-term supplier Kuwait Petroleum Corp, at stable volumes 2014, industry sources said on Wednesday.

It will buy about 2.5 million tonnes a year of high sulphur gasoil from state company KPC, with a tolerance level of plus and minus 10 percent, one of the sources said.

The contract was finalised at a similar price to this year, the source added. PSO had sealed its 2014 gasoil term contract with KPC at a premium of between $1.80 and $1.90 a barrel above Middle East price quotes, on a delivered basis, traders said.

Pakistan’s gasoil demand has weaker than in past few years due to a slower economy, traders said.

PSO has also been lifting gasoil from local refineries, including Karachi-based Byco Industries Inc which commissioned the country’s largest refinery earlier this year.

But volumes supplied from Byco has been intermittent as the company has been plagued with crude supply issues and financial problems, sources said, though this could not directly be confirmed with the company.

Separately, PSO has not finalised a jet fuel term with KPC, one of the sources said, though the reason was not immediately clear. -Reuters

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