SINGAPORE: Cash Dubai and DME Oman in the Middle East crude market recovered on Wednesday from lows seen earlier this week, supported by a rebound in fuel oil margins.
Cash Dubai's discount to swaps narrowed by about 20 cents from Monday while the discount for DME tightened by 30 cents from Tuesday.
Weakness in the benchmarks had depressed medium grades. Upper Zakum traded at a discount of about 50 cents to its official selling price (OSP), 10 cents wider than the previous deal, a trader said. Mitsui may have sold Qatar Marine at a discount of about 30 cents a barrel to its OSP.
"Market may have reached bottom if demand is still there," a the trader said, adding that good refining margins may support demand for these grades.
Platts said on Wednesday it will add Qatar's al-Shaheen and Abu Dhabi's Murban crude to its Dubai and Oman benchmarks from January 2016 to boost the liquidity of its price assessment process.
Murban crude can be delivered in its Dubai and Oman benchmarks and al-Shaheen crude will be included in the Dubai basket, it said in a subscriber note. The changes will take effect on Jan. 4, 2016. It will be the first time there is an alternative grade for delivery against the Oman marker.
The addition of the two grades will increase the volume of deliverable crude to almost 2.4 million barrels per day (bpd), three times as much as for the North Sea crude benchmark.
Sellers delivering al-Shaheen crude during the MoC will have to provide buyers the cargo's loading date by the end of the month, Platts said.
Platts added it will continue to review the potential inclusion of a quality premium for Murban for deliveries against lower quality Oman and Dubai.
TENDERS
Rosneft offered two ESPO cargoes for loading on Jan. 10-15 and 21-26 in a tender to close on Nov. 19. Bids will remain valid until Nov. 24.
DME OMAN
DME Oman for January settled at $39.94, down $0.34, at 0830 GMT. This puts DME Oman at $1.62 a barrel below Dubai swaps, up from a discount of $1.92 in the previous session.
REFINERY
India's Mangalore Refinery and Petrochemicals Ltd expects to operate its 100,000 barrel per day (bpd) crude unit, representing about a third of the plant's overall capacity, at a full rate from Saturday.
MARKET NEWS
Saudi Arabia's crude oil exports in Sept rose to 7.111 million barrels per day from 6.998 million bpd in August, official data showed on Wednesday.
Danish oil company Maersk Oil has several billion dollars to buy new licences, oil-producing fields or even launch a corporate takeover, the company's Chief Operating Officer told Reuters.
Iraq's semi-autonomous region of Kurdistan has for the first time detailed its secretive oil exports operations and said it plans to sell more, whether Baghdad likes it or not, as it needs money to survive and fight Islamic State.
Iran has started negotiations to buy shares in oil refineries in Europe, Latin America and Asia, the deputy oil minister was quoted as saying by Mehr news agency on Tuesday.
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