OPEC is maintaining its output even though global supply has exceeded demand, depressing oil prices to the lowest in nearly six years. The supply pressure will build in the second quarter when Asia's crude demand falls as refineries shut for seasonal maintenance.
State oil marketer Tasweeq sold three al-Shaheen cargoes for loading in March at an average discount of $2.64 a barrel to Dubai quotes, they said, down from a discount of 78 cents in the previous month. Buyers were not immediately known.
Qatar Marine has also slumped into a wide discount of 50 cents to its official selling price (OSP) after Petro-Diamond sold a cargo to Idemitsu at that level.
Taiwan's Formosa Petrochemical bought 2 million barrels of Omani crude from Shell via a tender for March delivery, traders said. The price is equivalent to about $2 a barrel below Dubai quotes on a free on board basis.
Adding to supply pressure, Iraq plans to boost monthly crude oil exports from its southern ports to a record high level in February, trade sources said.
The State Oil Marketing Organization (SOMO) has allocated 3.3 million barrels per day (bpd) of Basra crude to be shipped out in February, up from 2.7 million bpd in January, traders said, citing a preliminary loading programme.
DME OMAN
DME Oman for March settled at $45.14 a barrel, up $1.79, at 0830 GMT. This puts DME Oman at $1.90 a barrel below Dubai swaps against a discount of $1.81 in the previous session.
REFINERY
Sinopec Corp's 200,000 barrels-per-day subsidiary refinery in the eastern port city of Qingdao will be shut down for maintenance in the second or third quarter this year, an industry source with direct knowledge of the plant's operations said.
MARKET NEWS
South Korea's imports of Iranian crude oil fell 1.7 percent in December from a year earlier, and shipments for 2014 were below the 2013 average, meeting international sanction requirements.
ConocoPhillips has asked the US Commerce Department for guidance on whether it can ship its minimally treated light oil abroad, though the company does not believe it makes sense to export it now, the company's CEO said.
Qatar Petroleum and Shell said they had decided not to proceed with their $6.4 billion Al Karaana petrochemical project in the Gulf state, the region's second big energy project to be shelved since oil prices began to plunge late last year.
North Dakota expects its daily oil production to slip starting this summer if crude prices do not rebound quickly, a sign a price skirmish with OPEC may be having an effect.
Azerbaijan's state energy company SOCAR plans to boost its oil transportation via Russia to 1.7 million tonnes in 2015 from 1.02 million tonnes in 2014, a source at SOCAR said.