Cosmo Lifts US, Mexican oil on Common VLCC
Japanese refiner Cosmo Oil has for the first time shipped U.S. condensate and Mexican crude on the same supertanker to reduce costs, industry sources said on Friday.
U.S. condensate exports to Asia have slowed this year after West Texas Intermediate prices strengthened against Dubai crude, the Asian oil benchmark.
Asian buyers have also faced high freight costs to ship oil from the Americas as shippers are reluctant to lease out their tankers on such long voyages.
To reduce costs, Cosmo Oil is co-loading crude and condensate from the Americas onto a Very Large Crude Carrier which can carry up to 2 million barrels of oil.
The Japanese refiner chartered the BW Opal, which loaded Mexican crude in early October, according to trade sources and Reuters shipping data.
It then sailed to the U.S. port of Galveston later in October to load condensate.
The journey to Cosmo's Yokkaichi refinery will take about 55 days, longer than the usual route as larger vessels cannot pass through the Panama Canal, a source familiar with the matter said.
"The market is in contango so the time value has paid for some of the freight costs," he said.
In a contango market, oil becomes more expensive in future months.
Reporting by Florence Tan