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07Apr11
Libya rebel oil cargo China-bound: sources
China will buy the first oil cargo from Libyan rebels via trading house Vitol, sources said on Thursday, in a trial deal which is likely to clear the way for Europe to resume badly-needed purchases of Libyan oil.
Traders, however, added that it could take a long time before flows of crude from Libya reach substantial levels. The war has cut oil output by 80 percent while rebels and government forces trade charges over attacks on oil fields.
"Given that several governments, including some in Europe that now recognize it as the legal government of the country, there would be no legal obstacle to buying oil from it or even paying it directly," said J. Peter Pham, Africa director with U.S. think tank the Atlantic Council.
"This is especially convenient for countries like France and Italy," he said, adding the two countries normally get 15 and 20 percent respectively of their oil imports from Libya.
Trading sources told Reuters earlier on Thursday that the Liberia-registered tanker Equator, which can carry up to one million barrels of oil, was taking Libyan crude to China.
"The delivery will be made in China, but it's still not clear who the buyer is," said a Gulf-based trader. Other trade sources said Vitol had been involved in the deal. The trading house declined to comment.
AIS live ship tracking data on Reuters showed the tanker moving into the Mediterranean away from Libya's eastern ports of Marsa el Hariga and Tobruk, where it loaded oil on Wednesday.
An official with the vessel's Greek operators, Dynacom Tankers Management Ltd, declined to comment.
The tanker is expected to take around 28 days to arrive in China including transit times through the Suez Canal and Red Sea, a shipping source said.
"China has lifted oil from Libya before on a regular basis," the source said.
The expected shipment will be the first in weeks since an uprising against Libyan leader Muammar Gaddafi halted exports.
"If the first shipment makes it to China and there are no problems with the transfer of payments, we should be expecting to see more trade by the rebels who are being backed by Qatar," one Gulf-based trader said.
Officials from Qatar's oil ministry denied that the Gulf state is involved in the transfer or marketing of this shipment.
"As far as I'm aware, Qatar has not been involved in this deal," said an official, declining to be named.
Further Shipments
The rebel-led government said it had concluded a deal with Qatar to market crude oil and had discussed plans with a U.N. envoy to exempt its oil exports from sanctions that have been imposed on Libya.
Traders said they believed that the payments will be made via an offshore bank account.
"The value of this first shipment is around $112 million and will be made in a bank account outside of Libya that the rebels would have access to," one of the traders said.
Rebels have asked the United Nations to help restart oil and gas exports from ports they control and said the matter required "urgent attention" to enable Libya's economy to function.
Production at rebel-held oilfields in eastern Libya has stopped after they came under attack from forces loyal to Gaddafi, a rebel spokesman said on Wednesday.
"This is certainly not the last cargo from opponents of Gaddafi," said John Dalby, chief executive with maritime risk management specialists MRM.
"Libya's importance as an oil producer is being deliberately underplayed given her reserves and China will buy Libyan oil and establish its political and economic clout."
[Source: By Amena Bakr and Jonathan Saul, Reuters, Dubai and London, 07Apr11]
 | This document has been published on 03May11 by the Equipo Nizkor and Derechos Human Rights. In accordance with Title 17 U.S.C. Section 107, this material is distributed without profit to those who have expressed a prior interest in receiving the included information for research and educational purposes. |