Monday, 23 March 2015 17:18
SINGAPORE: DME Oman’s discount to Dubai widened in the Middle East crude market on Monday, as the focus turned to trade for Russian Far East grades.
Abu Dhabi’s flagship Murban grade was supported by robust refinery demand and tight supply with the premium to its official selling price (OSP) at more than 50 cents a barrel, traders said, although it was unclear if any deals have been done at those levels.
Complex refining margins in the Singapore hub have averaged $ 9.50 a barrel over the last three weeks.
“With maintenance in Asia still heavy over the coming period, we see the strength in refining economics in the region persisting over the course of next month,” analysts at JBC Energy said in a note.
Crude intake at Indian refineries would normally recover slightly in March. However, with half of Reliance’s 660,000 barrel-per-day Jamnagar refinery offline for maintenance, “the likelihood of a strong recovery in refining throughput remains somewhat limited,” they said.
Traders awaited offers for May-loading cargoes of Russia’s ESPO grade. Premiums were expected to come under pressure, due to higher availability. Earlier this month, Surgutneftegaz sold a prompt-loading cargo as low as $ 1.90 a barrel above Dubai quotes.
Regular ESPO buyers like JX Nippon, Cosmo Oil and TonenGeneral were planning maintenance at major crude distillation units (CDU) in May and June.
Chinese demand for Russian Far East grades was also seen lower, as refiners could snap up cheaper West African cargoes instead, traders said.
China’s crude imports from Iran fell 3.7 percent in February from a year ago, in line with expectations for the world’s second largest crude importer, customs data showed on Monday.
The imports last month from Iran were 2.04 million tonnes, or 532,400 barrels per day (bpd), up 13.5 percent from January on a daily basis, the data showed.
REFINERY
Japanese oil refiner Cosmo Oil Co Ltd restarted its 100,000-barrels-per-day No.1 crude distillation unit (CDU) at Chiba refinery, east of Tokyo, on Sunday following an unplanned shutdown, a company spokesman said.
DME OMAN
DME Oman for May settled at $ 52.43, up 25 cents, at 0830 GMT. This puts DME Oman at 84 cents a barrel below Dubai swaps, down from a discount of 67 cents in the previous session.
MARKET NEWS
OPEC will not take sole responsibility for propping up the oil price, Saudi Arabia’s oil minister said on Sunday, signalling the world’s top petroleum exporter is determined to ride out a market slump that has roughly halved prices since last June.
Noble Group Ltd said on Monday it plans to start legal proceedings after a little-known research firm accused one of Asia’s biggest commodities trading houses of inflating profits and understating its debt.
Copyright Reuters, 2015
