(Recasts, adds details)
CALGARY, Alberta/NEW DELHI, March 16 Indian Oil
Corp became India's first refiner to buy light sweet
Hibernia crude from Canada's largest oil company, doing the deal
after the opening of the arbitrage for Canadian oil to flow to
A decision by the Organization of the Petroleum Exporting
Countries (OPEC) to cut output strengthened Middle East
benchmark Dubai against other regional markers, allowing oil
from the Americas and Europe to be shipped to Asia at
Production in North America, led by U.S. shale output, is
increasing after supply cuts by OPEC and non-OPEC countries
pushed oil prices to above $50 a barrel.
This was also the first time that Suncor Energy has
sold a cargo of offshore Canadian crude to IOC, a Suncor
spokeswoman Sneh Seetal said on Wednesday.
Seetal declined to say how big the cargo was or when it
would load, but confirmed Canada's biggest oil company had won
an Indian Oil Corp tender.
"We do market our offshore crude production globally on an
opportunistic basis," she said.
Trade sources said Suncor sold the 1 million barrel cargo of
Hibernia crude to IOC on a free on board basis. Separately, IOC
has also bought its first Russian Urals crude cargo in about a
year in another tender.
IOC previously bought a cargo of Canadian White Rose oil in
November 2013. State-refiners like IOC were last year given the
freedom to draw up the crude import strategies that would allow
them to make swift gains from changing market dynamics.
News of the Suncor cargo comes after market sources this
week said two other vessels carrying Atlantic Canadian crude are
on their way to China.
The Stena Suede and the Jag Lalit, both Suezmaxes, loaded at
Whiffen Head terminal, Newfoundland, according to Reuters ship
tracking data. At least one of them was sold by Husky Energy
to buyer PetroChina, two sources said.
Husky had said in February it sold its first
one-million-barrel cargo of offshore Atlantic Canada crude bound
for China from its White Rose field.
At the time a Husky spokesman said low shipping rates helped
make the transaction worthwhile.
(Reporting by Nia Williams in CALGARY and Nidhi Verma in NEW
DELHI; Editing by Leslie Adler, Sandra Maler and Tom Hogue)