Adnoc has concluded 2005 term gas oil and jet fuel contracts with trading firms and at least one oil major at stronger premiums than 2004, traders have said.

The buyers agreed to pay a premium of $1.45 per barrel to Middle East prices on a free-on-board (FOB) basis for gas oil supplies, while the jet fuel premium was set at $1.20 per barrel to Middle East FOB quotes.
Under the 2004 contract, the premiums for gas oil and jet fuel were 80 cents and 90 cents per barrel to Middle East quotes, respectively.
"The premiums were higher than 2004 because they are following Saudi term prices which were fixed much higher than this year," a trader said.
Fellow Gulf exporter Saudi Aramco earlier raised its 2005 term gas oil premiums by 45-70 cents and its jet-kerosene premiums by 20 cents.
"The premiums were higher due to firmer spot market over the past six months. Refiners are already running at maximum which means products will be tight. Therefore, companies are willing to pay higher premiums to secure cargoes," one trader said.
Buyers were also willing to fork out higher premiums for Adnoc barrels relative to Saudi supplies due to superior jet fuel quality and cheaper freight, another trader said.
Expectations of firmer domestic demand in the Middle East and lower export volumes of high sulphur gas oil from the Gulf were other factors bolstering premiums.