SINGAPORE: Middle East crude benchmarks started a new month of trading on Thursday holding at steady levels from the previous month as traders await fresh prices from producers to determine the market's direction for May-loading cargoes.
OSP PREVIEW: Saudi Arabia is likely to cut prices for all crude grades it sells to Asia in April after demand for Middle East crude fell in last month's trade, trade sources said.
The official selling price (OSP) for Saudi's flagship Arab Light crude could fall by at least 40 cents a barrel in April, a survey of five refining sources showed.
Three of the five respondents expect deeper cuts of up to 70 cents a barrel.
"Arab Light's OSP is too high compared with other Middle Eastern grades," one of them said.
A widening of Oman and Dubai prices, the underlying benchmark for Saudi OSPs, may also prompt the producer to cut prices by another 15 cents, a second respondent said.
"(Also) arbitrage supplies are coming, so the Middle East producers have to lower their OSPs," he said.
All the respondents expects smaller price cuts of 40-60 cents for heavier grades after fuel oil margins in Asia improved.
Separately, ADNOC could cut February OSP premiums to Dubai quotes for Murban and Das by 15-20 cents while Qatar could also make a similar price cut for its Land crude, they said.
For Upper Zakum and Qatar Marine, their OSP premiums to Dubai quotes could fall by 20-30 cents, traders said.
SUPPLY: ADNOC has informed its customers of cuts in crude allocations for April, in line with the OPEC-led supply reduction deal, an industry source familiar with the matter said.
In April, only the Murban grade will be reduced by 25 percent, the source said.
WINDOW: Cash Dubai was at 14 cents above swaps after BP bought two May partials from Unipec at $61.36 a barrel.
Dubai crude, as quoted by price-reporting agency Platts, averaged at $62.721 a barrel for February, traders said.
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