SINGAPORE: The Middle East crude benchmarks edged down on Tuesday as traders await monthly official selling prices from Gulf producers to gauge prices for the December market.
OSP PREVIEW: Saudi Arabia is expected to keep the price for its Arab Light crude for loading to Asia in November little changed despite stronger benchmark prices for Middle East oil, trade sources said.
The producer could keep the OSP for the flagship grade unchanged or raise it by up to 10 cents a barrel, four refining and trade sources said in a Reuters survey.
The Saudis may raise prices to reflect a stronger Middle East crude market as the backwardation between the first-month cash Dubai price, a Middle East crude benchmark, and third-month cash Dubai widened by 25 cents in September from a month ago, one of the sources said. Spot prices are higher than those in future months in a backwardated market, which typically indicates stronger demand.
Still, other sources expect Saudi Arabia to take into account stronger prices for Oman, another Middle East benchmark crude, during the last week of trading in September.
Separately, ADNOC and Qatar Petroleum are expected to raise the OSP differentials to Dubai for all grades to reflect strong spot trading levels seen last month. Premiums for light grades - Murban, Das and Qatar Land - could rise by 50 cents while those for medium crude - Upper Zakum and Qatar Marine - could be increased by 35-40 cents.
ARBITRAGE: India's Reliance has purchased crude oil cargoes from the United States for the first time, drawn by the lower price for US oil versus global benchmarks, three trade sources said.
For this purchase, Reliance bought 1 million barrels of West Texas Intermediate (WTI) Midland and a similar-sized cargo of Eagle Ford crude, both of which are expected to arrive in November, the sources said.
US producer Occidental Petroleum Corp sold the WTI Midland cargo, they said.
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