SINGAPORE, Oct 11 2016 – Hong Kong-based trader Winson Oil purchased a very large crude carrier (VLCC) to store oil in the Mediterranean as part of an effort to expand into Europe.
This move is set to boost Asian gasoil margins if the firm successfully enters the spot market, allowing it to make big purchases for storage in said vessel.
According to Reuters, an insider source who wishes to remain anonymous revealed that the VLCC was purchased for approximately $28 million and was named Winson No.5. Reuters Eikon Terminal approximates that the vessel which was built in 2001 is capable of holding 2 million barrels of oil.
It is currently docked in Shenzhen, China awaiting repairs and maintenance. The ship will start operations within 1 to 2 months, ready to receive oil products.
In the interview with Reuters, the source went on to state that “The plan is to store gasoil and the ship will first travel to Singapore and eventually to the Mediterranean Sea as offshore inventory storage”. No timeframe was mentioned as to when the move to Europe would occur.
The source further elaborates that as part of its expansion into Europe, Winson Oil will start trade in European Markets through its office in Dubai which was incorporated in February. He adds that while storing gasoil in VLCCs could be potentially more expensive than using tanks on land, ownership of the newly acquired vessel will help to mitigate costs.
Despite the recent purchase, the source adds that the company has no plans to reduce its leasing of tanks onshore for gasoil storage.
According to Reuters, VLCC rates from the Middle East to Asia reached $40,200 per day, marking a new four-month high on the first week of October 2016.
The Hong Kong-based trader, Winson Oil, has been increasing oil trading activities in Singapore, where its trading arm is located. It has been routinely purchasing gasoil from Taiwan and selling it as bunker fuel to North Asia.
In addition to its office in Dubai, Winson Oil has offices in Taiwan, Singapore, China, and other Asian countries. According to its website, the oil trader currently possesses a fleet numbering more than 25 vessels.
Winson Group
Since its establishment in 1998, Winson Group has grown to become one of Asia’s largest international energy trading corporations, best recognized for its oil trading and bunkering operations throughout Asia. The group now has offices and projects in Hong Kong, Singapore, Taiwan, Mainland China, Dubai, and other Asian countries, so it can provide a wide range of services to customers.
The group has developed strong and reliable ties with Asia’s major refineries. The group maintains extensive business relationships in Singapore, Indonesia, the Philippines, South Korea, China, Vietnam, and Timor-Leste, among other countries. By capitalizing on its strong market position and in-depth awareness of customer needs, the group has established three distinct lines of business: international oil trading, global marine bunkering, and oil storage and terminal facilities.
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