(Bloomberg) -- Glencore Plc has emerged as an active buyer of spot oil cargoes from the Middle East this month, as the merchant starts procuring crude for the Bukom refinery in Singapore, according to traders.
The company purchased three cargoes of Qatar’s Al-Shaheen grade and at least one of Abu Dhabi’s Upper Zakum, the traders said, asking not to be identified as they’re not authorized to speak publicly. The shipments will load in February, they added, and can arrive in Asia the same month, or in March.
Glencore has been gearing up for a bigger role in the physical oil market after acquiring the Bukom refining and chemicals complex from Shell Plc earlier this year with Indonesia’s PT Chandra Asri Pacific. The refinery includes a 237,000 barrel-a-day crude distillate unit.
A spokesperson for Glencore declined to comment on the matter.
In recent years, cash-rich energy traders have been eager to pick up physical assets such as aging refineries and distribution networks as Big Oil speeds up its divestment from fossil-fuel plays due to shareholder pressure. The assets provide merchants with greater exposure to physical and paper markets.
Glencore has recently hired Aditya Ravavarapu from BP Plc to lead its Asian oil trading team, Bloomberg reported last week. Ravavarapu had traded physical crude in the region and worked with BP’s assets in Australia, which were refineries before they were shuttered.
The traders said Glencore is expected to play a bigger role in physical markets from around February or March next year as it takes over the job of procuring oil for the Bukom complex, which predominantly runs on sour crude. The recently purchased cargoes were 500,000 barrels each, they added. They may still be traded or so-called optimized, depending on market conditions.
The refinery previously processed grades that included Saudi Arabian crude, which was supplied by Shell as part of a long-term contract with state-owned producer Aramco.
--With assistance from Yongchang Chin and Alex Longley.