SINGAPORE- * The premium of Brent crude futures to Middle East benchmark Dubai fell to $1.25 a barrel, the lowest since the end of July after global benchmark Brent dropped to a seven-month low on Friday, Refinitiv data showed

* A narrowing of Brent's premium to Dubai typically spurs demand for Brent-linked grades produced in the Asia Pacific and the Atlantic Basin

* However, strong freight rates have been curbing arbitrage flows from the Atlantic Basin, prompting Asian buyers to turn to sources closer to home, two traders said

* The narrowing price spread between the two benchmarks could also depress demand for Dubai-linked grades produced in the Middle East and Russia, they said

(Reporting by Florence Tan; Editing by Christian Schmollinger) ((Florence.Tan@thomsonreuters.com; +65 6870 3497; Reuters Messaging: florence.tan.thomsonreuters.com@reuters.net))