Oil traders have begun fixing tankers to take North Sea, West African and Arab crudes to South Africa for storage, hoping for a repeat of the multimillion dollar bonanza they reaped in 2008-2009.
Shipping fixtures show that in late July and August, BP , Mercuria, Total and Chevron all booked suezmaxes to deliver crude to South Africa, with traders saying that a good number of these barrels will go into storage.
Storing crude is now considered profitable for some companies because of a glut of barrels in the Atlantic Basin which has weighed on physical crude prices and Brent crude futures.
As a result, a contango structure has developed which should allow traders to sell stored crude for a profit at a later date.
(Reporting by Claire Milhench, editing by David Evans)