SINGAPORE: The Middle East crude market stayed weak on Wednesday with cash Dubai and Oman at discounts of more than $2 against swaps.
Weak prices for medium grades may rub off on al-Shaheen
which will trade this week.
Tasweeq offered two al-Shaheen crude cargoes for loading in January in a tender to close on Thursday, traders said. Prior to the tender, Unipec has shown its cargoes to buyers although no offers were made yet, they said.
December-loading cargoes in Tasweeq's tender last month fetched an average discount of $1.79 a barrel to Dubai quotes.
The outlook for light grades was mixed, pending South Korean demand.
South Korean's demand for January-loading Murban may rise as they scale back North Sea Forties imports after the government changed freight rebate requirements, an analyst said.
A trader expects robust demand to keep January differentials for Murban and Das in premiums of 20-40 cents a barrel.
Still, Murban may weaken after premiums for Russian grades such as Vityaz, Sokol and ESPO slumped last month, a trader with a North Asian refiner said.
Despite a bigger-than-expected price hike for Arab Extra Light, the Saudi grade remained competitive against Murban, depressing demand for the Abu Dhabi grade, he added.
China's implied oil demand rose 0.9 percent in October from a year ago, recovering from a slight dip the previous month as auto sales in the world's second-largest economy rose at their fastest pace since December 2014.
China could double its crude oil purchases for strategic purposes to 80 million barrels next year if prices remain low, Barclays analyst Zhang Chi said in a note.
Still, China's SPR demand estimated at 230,000 barrels per day, against an excess supply of about 1.5 million bpd globally, is "likely to exert only a small influence on the oil market balance and oil price volatility," Zhang said.
DME OMAN
DME Oman for January settled at $44.89, down $0.10, at 0830 GMT. This puts DME Oman at $1.80 a barrel below Dubai swaps, down from a discount of $1.75 in the previous session.
Comments
Comments are closed for this article.