Middle East Crude-Benchmarks touch month's high; Murban discount widens

SINGAPORE: Middle East crude benchmarks Dubai and Oman rose on Friday to their highest premium this month, although light grades weakened further as competing arbitrage supplies rise.

The discount for March-loading Murban crude has widened after BP offered a cargo on RIM at 35 cents a barrel below its OSP. BP's offer was 15 cents a barrel lower than Total's offer on Thursday's Platts window.

Total changed its offer to Dubai basis on Friday and set it at $1.80 a barrel above Dubai quotes. Vitol placed an offer at $1.75 a barrel above Dubai quotes, 25 cents lower than its offer earlier this week.

Light grades stayed under pressure as arbitrage supplies to Asia rise after freight rates fell. Indian Oil Corp bought 4 million barrels of African oil, mainly Nigerian grades, in a tender awarded on Thursday while US crude sellers have reduced offers.

Taiwan's Formosa Petrochemical bought one or two Oman crude cargoes loading in March at 35-40 cents a barrel above Dubai quotes late on Thursday, traders said.

Iraq's SOMO issued tenders to sell February-loading Basra crude. It offered 2 million barrels of Basra Light and 1 million barrels of Basra Heavy in a tender that will close on Jan. 16.

OSP: Iran has set the official selling price (OSP) of its Iranian Light grade for Asian buyers at $0.40 above the Oman/Dubai average for February, up 10 cents from the previous month, documents reviewed by Reuters showed.

Kuwait has raised the February official selling prices (OSPs) for two crude oil grades it exports to Asia, a document reviewed by Reuters showed.

The February Kuwait Export Blend Crude (KEC) price was set at 25 cents a barrel below the average of Platts Oman and Dubai prices, up 10 cents, while the OSP for Kuwait Super Light Crude (KSLC) rose 40 cents to a $1.50 a barrel premium.

RUSSIA: ONGC has sold a cargo of Russian Sokol crude loading in March at the lowest premium in six months after the oil's benchmark price Dubai strengthened against Brent, trade sources said.

The producer sold 700,000 barrels of Sokol crude loading on March 10-16 to Vitol at $3.70-$3.80 a barrel above Dubai quotes, they said.

The premium is about 50 cents a barrel lower than the previous month.

The average Brent premium to Dubai quotes so far this month is about 29 cents a barrel, lower than the average for last month Sokol is also facing more competition from arbitrage supplies after freight fell, while Japan's demand is set to fall during maintenance in second quarter, one of the sources said.