SINGAPORE: The Middle East crude market strengthened on Wednesday with Qatari al-Shaheen for June sold at much narrower discounts from the previous month on robust demand in Asia.
Asian demand has risen with the end of seasonal refinery maintenance while Middle East crude supply has tightened.
Maersk sold three cargoes at 40-50 cents a barrel below Dubai quotes, traders said, versus discounts of $1.50-$1.90 a barrel for May-loading barrels sold last month. Buyers were not immediately known.
Unipec sold two cargoes in a tender on Tuesday at slightly lower levels than Maersk, a trader said.
Formosa bought 1 million barrels of June-loading Oman crude from traders at 55-60 cents a barrel below Dubai quotes in a tender, traders said. The Taiwanese refiner is also seeking 2 million barrels of Iraqi Basra crude in a tender which closes on Friday.
Cash Dubai strengthened by about 40 cents from a week ago despite lower trade volumes on the window. Ten partials traded which did not lead to any cargo deliveries.
Russian ESPO crude's spot premium rebounded by at least 20 percent for a June-loading cargo on robust demand and tighter Middle East oil supply, trade sources said.
Producer Surgutneftegaz has sold a 730,000-barrel cargo at a premium of more than $3 a barrel to Dubai quotes to an unknown buyer for loading on May 31-June 5, they said. Most of the May-loading cargoes were sold last month at premiums of $1.85-$2.50 a barrel.
Rosneft has sold three Sokol crude cargoes at steady to lower levels from previous month. Vitol and Lukoil bought a cargo each to load on June 10-19 and 21-30 at a premium of just above $4 a barrel to Dubai quotes. The cargo loading on May 31-June 9 was re-tendered and sold at $3.90 a barrel above Dubai quotes to an unknown buyer.
DME OMAN
DME Oman for June settled at $58.28 a barrel, up 70 cents, at 0830 GMT. This puts DME Oman at 51 cents above Dubai swaps against a discount of 40 cents in the previous session.
MARKET NEWS
World oil markets may take longer to tighten than expected due to a surge in OPEC supply and a potential rise in Iranian exports, even as demand shows signs of strength, the International Energy Agency said.
The US government on Tuesday forecast domestic crude production will rise even more than expected a year ago, undeterred by the worst price rout since the financial crisis.
China's implied oil demand in March rose 7.6 percent from a year ago, as refinery throughput hit a record high due to continued strength in gasoline and kerosene consumption in the world's top energy consumer.
South Korea's imports of Iranian crude doubled in March from a year earlier but the country's oil shipments from the OPEC country in the first quarter of this year fell 16 percent year- on-year to meet international sanction requirements.
Russia's energy ministry has been holding active consultations with the Organization of Petroleum Exporting Countries and Latin American oil producers which Deputy Prime Minister Arkady Dvorkovich described on Wednesday as "unprecedented".
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