SINGAPORE: The Middle East crude market softened on Friday with DME Oman's premium to Dubai down for the seventh session to reach the lowest in more than two weeks.
Trade in September-loading barrels has yet to start this month as Asian refiners are still finalising their requirement while waiting for a clearer demand outlook. Refiners have capped utilisation rates on weak margins.
"It's not a matter of prices, it's a matter of demand," a trader with a North Asian refiner said.
Iraqi Basra Light crude exports may fall in August, following a dip in June due to ongoing maintenance and expansion work at one berth at the oil terminal.
Iraq has scheduled to load 2.2 million barrels per day (bpd) of Basra Light crude in August, down from 2.7 million bpd a month earlier, traders said, citing preliminary loading programmes. The cuts were mainly on allocations for oil majors, they said.
Still, the reduction in Basra Light supply is unlikely to have a big impact on Asia as refiners have reduced purchases of August-loading spot cargoes on supply disruption concerns following an Islamic uprising in the country.
Russian ESPO crude premiums slipped as three additional cargoes were added to the August programme. Gazprom Neft has sold a cargo for mid-August loading at a premium of just above $2 a barrel to Dubai quotes to an unknown buyer, traders said.
More details also emerged for Surgutneftegas' ESPO tender.
The cargo to load on Aug. 31-Sept. 5 was awarded to Statoil at about $3.10 a barrel above Dubai quotes, traders said. The deals could not be independently verified.
OSP
Iran has set the official selling price (OSP) of its Light crude oil loading in August to Asian buyers at $2.30 a barrel above the average of Oman/Dubai quotes, traders said on Thursday, down 20 cents from the month before.
Kuwait set the official selling price (OSP) for its crude oil sales to Asian buyers for August 40 cents a barrel below the average of Oman/Dubai quotes, down 30 cents from July, traders said.
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