PetroDiamond International (PDI), the trading arm of Mitsubishi Corp 8058.T, will be loading an Australian Van Gogh crude cargo for Japan later this month to meet peak summer power demand, according to shipping data and trade sources. The world’s No. 2 liquefied natural gas (LNG) importer expects to face a tight electricity market again this summer and winter, turning to oil for burning at power plants, as the crisis in Ukraine has driven up gas and coal prices. Europe is stockpiling utility fuels amid rising tension with its biggest gas supplier Russia. Moscow is requesting payments for its gas in Russian roubles or it will cut supplies. PDI has provisionally chartered Aframax tanker P. Yanbu to load Van Gogh crude from Australia around mid-May, shipping data showed.
A Mitsubishi spokesperson said the company trades crude to meet customers’ needs but it can’t comment on any commercial deal. Traders who track Japan’s oil markets closely said the crude is typically burned at Japanese power plants. Van Gogh crude last headed for Japan in December and in late 2019 before that, according to Refinitiv data. Japan’s biggest oil refiner Eneos Holdings Inc 5020.T said last month that it is getting requests from utilities to double the supply of fuel oil used in oil-fired power stations in April-September from a year earlier, although it’s unlikely to be able to meet all the demand.