Middle East Crude-Benchmarks slide for fifth session, closer to al-Shaheen levels

The producer has sold three cargoes of al-Shaheen crude loading in January at the highest premiums in nearly two years on robust demand in Asia

  

Middle East crude benchmarks Oman and Dubai slid for a fifth session, closer to levels seen for similar quality al-Shaheen crude sold by QatarEnergy in a tender.

The producer has sold three cargoes of al-Shaheen crude loading in January at the highest premiums in nearly two years on robust demand in Asia, trade sources said.

The average premium for the cargoes sold via a tender was at $3.45 a barrel above Dubai quotes, they said, up $1.11 from the previous month.

The producer also set the month's term price at a premium of $3.68 a barrel, the sources said, up $1.20 from the previous month.

Unipec, Idemitsu and Vitol likely bought the cargoes loading on Jan. 1-10, 11-20 and 21-30, the sources said.

These are the highest premiums seen for Qatar's al-Shaheen tenders since cargo loading in February 2020, according to Reuters data.

ASIA-PACIFIC CRUDE

Vietnamese state oil marketer PV Oil has sold a cargo of Chim Sao crude for January loading at the highest premium in 20 months, trade sources said.

Crude supplies from Southeast Asia have tightened lately as Vietnam's domestic refinery ramped up operations after the government eased COVID-19 restrictions, while the output of Malaysia's key export grade, Kimanis, has fallen.

The 300,000-barrel cargo loading on Jan. 15-19 was sold to Japanese refiner Taiyo Oil at about $4.50 a barrel above dated Brent, the sources said. The premium was about $1 higher than the previous month.

Chim Sao last traded at this level for cargoes loading in May 2020. BFO-CHS

RUSSIAN CRUDE

Russian producers have sold another six ESPO crude cargoes at about $6 a barrel above Dubai quotes for loading in January, trade sources said on Wednesday, with premiums easing from near two-year highs seen earlier this week.

Surgutneftegaz SNGS.MM and Paramount Energy sold three cargoes each via tenders late on Tuesday at premiums between $5.90 and above $6 a barrel, they said.

Buyers included BP, Equinor and Mercuria, the sources said.

The two sets of cargoes are to load on Jan. 10-17, 13-20 and 17-24.

Surgutneftegaz has issued a third tender to sell another three ESPO cargoes for loading on Jan. 20-27, 24-30 and 27-31 which will close later on Wednesday.

WINDOW

Cash Dubai's premium to swaps fell 21 cents to $3.44 a barrel. Seller-Buyer Price Vitol-Lukoil 81.05 Vitol-Gunvor 81.05 Vitol-Lukoil 81.05 Koch-Gunvor 81.05 Unipec-Gunvor 81.05 Reliance-Lukoil 81.05 Unipec-Gunvor 81.05 Unipec-Shell 81.00 Vitol-Lukoil 81.04 Reliance-Gunvor 81.00 Vitol-Lukoil 81.04 Unipec-Gunvor 81.00 Reliance-Gunvor 81.00 Unipec-Gunvor 81.00 Mitsui-Lukoil 81.04 Unipec-Gunvor 81.00

PRICES ($/BBL)

CURRENT PREV SESSION DME OMAN 81.26 82.16 DME OMAN DIFF TO DUBAI 3.70 3.86 CASH DUBAI 81.00 81.95

REFINERY

Trafigura is preparing to sell its 24.5% indirect stake in an Indian oil refining joint venture with Russia's Rosneft to an Italian group, a letter seen by Reuters shows and people familiar with the commodity trading firm's plans said.

NEWS

Whether fuel pump prices fall in 2022 depends on two groups of producers who are struggling to increase oil output in the wake of the pandemic: OPEC and its allies and U.S. shale firms.

OPEC is seeing signs of an oil supply surplus building from next month so its members and allies will have to be "very, very cautious" when they review output policy at regular monthly meetings, the group's secretary general said on Tuesday.

China's Sinopec Corp said it completed a successful trial processing crude oil directly into olefin, making the top Asian refiner one of the world's few companies that have applied the technology at an industrial scale.

Oil and liquefied natural gas (LNG) prices could climb higher this winter as low inventories will not be able to cushion the market from supply disruption or demand shocks, a senior executive of energy trading group Vitol said.

For crude prices, oil product cracks and refining margins, please click on the RICs below.

Brent BRENTSGMc1 Dubai DUBSGSWMc2 DME Oman OQc1 Brent/Dubai EFS DUB-EFS-1M

PRODUCT CRACKS Fuel oil crack FO180SGCKMc1 Gasoil crack GOSGCKMc1 Naphtha crack NAF-SIN-CRK Complex refining margins REF/MARGIN1

(Reporting by Florence Tan)


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