(Recasts with Shell confirmation, adds market movement)
KUALA LUMPUR, June 25 (Reuters) - Royal Dutch Shell RDSa.L has shut its 125,000 barrels per day (bpd) oil refinery at Malaysia's Port Dickson for regular maintenance, the company said on Wednesday.
Earlier, a source at the refinery told Reuters that Shell had shut a certain section of the refinery on Malaysia’s west coast from June 17 for a 45-day maintenance.
“Shell confirms that its refinery in Port Dickson is currently undergoing a planned, statutory shutdown for maintenance,” a Shell spokesperson said in response to Reuters queries.
“Equipment maintenance is planned well in advance, regularly reviewed and coordinated with our needs to supply customers and to keep our equipment running in a safe manner.”
Traders said that Shell has been snapping up several 97-octane gasoline cargoes from the Singapore market since late-May to prepare for the maintenance.
“They have bought a fair bit of gasoline cargoes and I believe they are slated to land in Malaysia, as the country uses mainly 97-octane grades,” said one of the traders.
Between May 29 and June 20, Shell bought a total 500,000 barrels, or 10 parcels, of 97-octane gasoline for mid-June to early-July lifting at a strong $136.00-$152.00 a barrel.
This has caused supply of 97-octane gasoline to tighten, traders said. But lower octane-grade gasoline remains abundant and this has weighed on the reforming margins, which fell to a three-and-a-half month low at $9.26 a barrel on Tuesday.
The spokesperson said that as a policy, the company could not give details on operational status of its individual units or information on supply.
The source at the refinery, who declined to be identified due to company policy, had said earlier: “It started from June 17 and it is for a certain section.”
A fire official had said that the refinery was shut from Wednesday for 45 days of total maintenance, which normally takes place every four to five years.
The complex refinery, which added a long residue catalytic cracking (LRCC) unit in 1999, produces motor gasoline, diesel, jet fuel and liquefied petroleum gas, which are mostly supplied to the domestic market. (Reporting by Jalil Hamid and Niki Koswanage; Additional reporting by Chua Baizhen and Seng Li Peng in Singapore; Editing by Ramthan Hussain)
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