SINGAPORE: The Middle East crude market remained under pressure on Tuesday, with little activity as refiners hold back despite a recent upturn in refining margins.
Abu Dhabi's Murban and Das Blend were sold out, but plenty of cargoes for November loading were left in the market, including Qatar Marine and Upper Zakum, traders said.
Das Blend was last traded at 50-55 cents a barrel below its official selling price (OSP). Basra Light had yet to trade.
Asian refining margins have improved in recent weeks, but a weak market structure for middle distillates going into the winter trading period had raised doubts about refining profits going forward.
"I think the refineries are being cautious, and there is plenty of crude available," one trader said. "Winter is approaching and markets should be getting better, but there are no signs of a pick-up."
However, improving refining margins could spur some interest in shorter-haul cargoes, such as Russia's ESPO and Sokol, another trader said.
"I don't think there is much demand left for November-loading Middle East grades," the trader said.
The result of a Rosneft tender that closed yesterday, for the sale of two ESPO cargoes loading Nov. 5-10 and Nov. 9-14, could not be confirmed. Traders said premiums were likely to have dropped from recent levels around $2 a barrel above Dubai quotes.
Premiums for the grade may have been depressed by additional supply for exports after a refinery fire in Russia this year, while Western sanctions against Russia could also make some buyers more cautious, traders said.
DME OMAN
DME Oman for November settled at $95.99, up 1 cent, at 0830 GMT. This puts DME Oman at 26 cents a barrel below Dubai swaps, up from a discount of 51 cents in the previous session.
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