South Korea's GS Caltex raises 500 CST bunker sales to 50,000 mt/month on more storage

South Korean refiner GS Caltex raised its sales volume for 500 CST bunker fuel to 50,000 mt/month in September and August, from 25,000 mt in July, when it increased its storage capacity for the grade, a company source said Wednesday.

Trade sources said its sales of the grade in October would reach 50,000 mt as well. They added that competitive prices from the refiner also boosted its sales volume.

GS Caltex started selling 500 CST bunker fuel in May, and increased its storage capacity for the grade in July by converting one tank from 380 CST to 500 CST, Platts reported previously. The capacity of the tank was not disclosed by the company, but a trader said that it probably could contain 20,000-30,000 mt of the fuel.

The refiner had forecast that demand for the 500 CST grade would grow as prices were lower than those for 380 CST bunker fuel.

The refiner has so far sold the 500 CST grade at flat to a premium of up to $5/mt to Mean of Platts Singapore 380 CST high sulfur fuel oil assessments, the company source said. These prices were considered competitive by other bunker players, and even Hong Kong demand took a hit because of GS Caltex's attractive prices in South Korea, bunker traders said.

Hong Kong's 500 CST prices have been at a premium of around $8/mt to MOPS 380 CST HSFO assessments, a Hong Kong bunker supplier said.

GS Caltex is trying to increase 500 CST sales further to 70,000-100,000 mt/month, trade sources said.

Another South Korean refiner, SK Energy, also sells 500 CST bunker fuel. SK Energy sells about 20,000 mt/month of bunker fuel at premiums of around $10/mt to MOPS 380 CST HSFO assessments, bunker traders said.
Source: Platts