SINGAPORE: DME Oman remained at a discount to Dubai swaps in a subdued Middle East crude market on Tuesday.
Weak refining margins combined with ample crude supply are expected to weigh on differentials for October-loading cargoes which will trade later this week.
The Singapore refining crack based on Dubai skidded below $3 this month, down from an average of $4.40 a barrel in July, the lowest in at least eight months, Reuters data showed.
On the supply side, a fall in Brent's premium to Dubai to the lowest since July 2010 will keep the arbitrage window for crude from North Sea, Africa and Latin America to Asia wide open.
Brent-Dubai Exchange of Futures for Swaps (EFS) for September was valued at $1.07 a barrel, down 48 cents from Monday's close and the narrowest since July 8, 2010.
The October spread has also fallen below the $2 mark to $1.66, down 54 cents from Monday.
*TENDERS
Rosneft has issued a tender offering 700,000 barrels of Sokol crude for loading on Oct. 19-28. The tender will close on Aug. 13.
*DME OMAN
DME Oman for October settled at $103.01, down 15 cents, at 0830 GMT. This puts DME Oman at 8 cents a barrel below Dubai swaps against a discount of 13 cents in the previous session.
*REFINERY
Chinese state energy giant Sinopec is temporarily cutting production at one of its refineries to reduce emissions in anticipation of the Youth Olympic Games this month in the eastern city of Nanjing, the company said.
Subsidiary Jinling Petrochemicals has cut crude throughput by 200,000 tonnes, or around 21 percent, for August, reducing emissions of sulphur dioxide by 30 percent and nitrogen oxide by 57 percent.
Sinopec Corp will shut down its Jiujiang refinery in central China for around a one-month overhaul in October, an industry source said.
*MARKET NEWS
Huge rises in oil production from North America are keeping oil markets increasingly well supplied, the West's energy watchdog said on Tuesday, suggesting oil prices are unlikely to rise much soon despite conflicts near key oil producing areas.
US oil production from the country's fastest-growing shale plays is set to rise by some 89,000 barrels per day in September from a month earlier, Energy Information Administration data showed on Monday.
Two of China's largest shipping firms are setting up a $1.1 billion crude oil tanker joint venture with a view to build up the country's fleet, as the world's second-largest oil consumer seeks better control over its oil imports.
The Brazilian government could increase domestic fuel prices at refineries by up to 6 percent after the October presidential election, a senior government source told Reuters on Monday.
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