Singapore: Chinese authorities have delayed the delivery of more than 100,000 tonnes of fuel oil mixed with Sudan’s new Dar Blend crude over customs issues related to the cargoes, port and industry sources said yesterday.

Two aframax tankers, the Myrina and the Tian Xing Zhou, discharged the shipments into bonded storage at the northeast China ports of Qingdao and Tianjin about two weeks ago after a delay of two weeks, the sources told Reuters.

Beijing-based trading sources said the oil remained in bonded storage – tanks which hold oil that cannot enter the country without being taxed – although it was not clear whether authorities were still restricting its use.

The delay was thought to stem from the customs department’s uncertainty over whether the blended fuel, which sources said was listed as low-sulphur straight-run fuel oil mostly used for feedstocks by small "teapot" refineries, should be classified as fuel oil or crude.

Low cost
The issue may pose trouble for traders who had hoped to capitalise on Dar Blend’s low cost by blending it into the fuel oil pool and selling it into China, the world’s biggest consumer of fuel oil for refineries and power plants.

The cargoes were sold by Singapore-based PetroTitan, trading arm of Hong Kong-listed Titan Petrochemicals Group, to unknown Chinese buyers on a free-on-board (FOB) basis.

"It would appear that the situation is not resolved even though the vessels were allowed to discharge and depart the ports," a Singapore-based trading source said.