Lloyd's Maritime and Commercial Law Quarterly


Sanam Saidova *

208. BP Oil International Ltd v Glencore Energy UK Ltd 1

Sale of crude oil on CIF terms—terms of contract—battle of forms—variation of contract breach of warranty as to quality—measure of damages—Sale of Goods Act 1979, s.53(3)—mitigation—storage and transportation costs—demurrage—cargo volume losses
This case concerned a claim for damages brought by the claimant, BP Oil International Ltd (buyer), in relation to a cargo of crude oil bought from the defendant, Glencore Energy UK Ltd (seller). The buyer alleged that the crude oil was contaminated with organic chloride. The buyer resold the cargo to an affiliated company, BP Europa SE (BPESE) (for delivery “CIF Wilhelmshaven”), which intended to process the oil at its Gelsenkirchen refinery. After the contamination was discovered, BPESE sold the oil back to the buyer at a discount and the buyer sold it to a Spanish affiliate, BP Oil Espana SA (BPOESA), delivery “ex ship Castellon”. The contaminated oil was processed by BPOESA at its Castellon refinery.
The contract of sale between the seller and buyer, formed in April 2019, provided for the sale of 100,000 MT (+/- 10%) Russian Export Blend Crude Oil (REBCO), to be loaded between 13–18 April 2019, delivery CIF Rotterdam at a price of “Dated Brent + 0.53USD” per barrel. On 1 April 2019, the seller emailed the buyer a recap of what was agreed for approval and acceptance. The recap incorporated BP’s General Terms and Conditions (GTCs) 2015. On 2 April, the buyer sent an email confirming the deal and including further terms. The seller replied attaching its own sale contract (Glencore sales contract). On 3 April, the buyer agreed to Glencore’s sales contract “subject to the following” deletions and additions. The seller responded by saying that it intended to maintain its own wording. On 4 April, the buyer emailed stating that “only terms which had been expressly agreed by both parties, at the time of trade or subsequently” would be binding and rejecting any “proposed amendments unless expressly agreed” by the buyer in writing. The email continued that “neither failure or delay in responding, nor performance of the agreement” would amount to acceptance of terms which had not been expressly agreed between the parties. On 8 April, the seller replied that it maintained its position and would not engage in further correspondence unless the buyer changed its position and that nothing would be deemed or constituted acceptance of the clauses in dispute.
The buyer claimed that the contract for the sale of crude oil, incorporating its GTCs, was concluded on 2 April when the recap was confirmed and that the crude oil was contaminated with organic chloride, which was in breach of the recap quality clause



The rest of this document is only available to i-law.com online subscribers.

If you are already a subscriber, click Log In button.

Copyright © 2024 Maritime Insights & Intelligence Limited. Maritime Insights & Intelligence Limited is registered in England and Wales with company number 13831625 and address 5th Floor, 10 St Bride Street, London, EC4A 4AD, United Kingdom. Lloyd's List Intelligence is a trading name of Maritime Insights & Intelligence Limited.

Lloyd's is the registered trademark of the Society Incorporated by the Lloyd's Act 1871 by the name of Lloyd's.