Angola. File Image / Pixabay
Angolan oil sales to China are bouncing back from a five-year low thanks to the upcoming IMO2020 rule.
"We believe the levels in demand we are seeing for September are related in part to the interest in specific grades suitable for refining into IMO-compliant bunker fuels," a crude seller was quoted by Reuters as saying.
Cabinda, Kissanje and Hungo grades are particularly suited to production on the new fuels, they added.
The new IMO2020 rule will see the vast majority of vessels switch to burning a marine fuel with a maximum sulfur level of 0.50%, resulting in a dramatic decline in HSFO demand as a result.
Refiners can minimise HFO production in two ways; costly refinery upgrades that can take several years to complete, or switch to a more favourable crude slate.
Given the relative ease of the latter, interest in Angolan crudes is expected to continue.
“As refiners increase their efforts to look for alternatives to present bunker fuel, Angolan grades will improve,” an analyst at Refinitiv said.
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