July 11, 2013 / 7:51 PM / 5 years ago

Repsol buys 1 million barrels of Castilla crude -trade

July 11 (Reuters) - Pacific Rubiales sold Repsol a million barrels of Castilla crude on Wednesday at $2.60 a barrel under September West Texas Intermediate, traders said on Thursday.

Loading for the cargo, which traded well over valuations for the crude heard in recent weeks of $8 a barrel under international benchmark Brent, was set for between July 5 and July 25.

Brent settled at a $2.82 premium to WTI on Thursday.

Repsol and Pacific Rubiales declined to comment on the deal, citing company policy against making statements on market issues.

Some traders were baffled by the high prices fetched by the cargo and noted that, during the bidding process, a second offer had been made at $3.10 a barrel under WTI, indicating the winning deal was close to current market value.

Traders attributed the high prices to tight European crude supplies, adding that buyers may use the heavier Castilla as a blend component, which may make the economics behind the deal more advantageous than what they seem at first sight.

Pacific Rubiales opened another tender to sell a separate million-barrel cargo of Castilla, with results expected late Thursday afternoon.

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