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|22 April, 2019

Middle East oil benchmark Dubai rises to multi-year high on Iran sanctions

Russian, Mideast grades trade at highest premiums in 5-7 months

Cars queue for petrol at a gas station in Dubai June 11, 2012. Image for illustrative purposes.

Cars queue for petrol at a gas station in Dubai June 11, 2012. Image for illustrative purposes.

REUTERS/Ghazal Watfa

SINGAPORE- Middle East crude benchmark Dubai jumped on Monday to the highest premium in more than five years ahead of an expected announcement by Washington to end U.S. sanctions waivers for Iranian oil buyers, according to trade sources and Reuters data.

Cash Dubai's premium to Dubai swaps, was at $1.79 a barrel, the highest since at least 2014, the data showed. DME Oman's premium to Dubai swaps also touched $1.90 a barrel on Monday, the highest since October.  

The United States is expected to announce on Monday that buyers of Iranian oil need to end imports soon or face sanctions, a source familiar with the situation told Reuters, triggering a 3 percent jump in crude prices to their highest for 2019 so far. 

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Buyers will have no choice but to pay more for alternative supplies if the United States decides to stop waivers for Iranian oil buyers, traders said.

MIDEAST: Taiwanese oil refiner CPC has bought three cargoes of Upper Zakum crude for June loading in its monthly tender, trade sources said.

The refiner bought the cargoes at premiums of 10 cents to 15 cents a barrel to the grade's official selling price (OSP), they said, similar premiums compared with earlier deals for the grade.

Thailand's PTT also bought medium sour grades on behalf of refiner IRPC although details were not immediately available.

RUSSIA: Spot premiums for Sokol crude continued to climb, rising to a five-month high after Exxon Mobil sold a cargo at $4.60 a barrel above Dubai quotes in the latest deal for the grade, trade sources said. 

Exxon sold one of two cargoes it offered in a tender late on Thursday, they said. The buyer was not immediately known.

ASIA-PACIFIC CRUDE: Petronas has sold a June-loading Labuan crude cargo at a premium of more than $5.50 a barrel to dated Brent to an unknown buyer, a trader said.

REFINERY

Saudi Aramco will acquire Royal Dutch Shell's 50 percent stake in their Saudi refining joint venture SASREF for $631 million, the two companies said. 

Kuwait National Petroleum Co (KNPC) said on Saturday it had put out a small fire at a unit within its Mina al-Ahmadi refinery and that operations had not been disrupted. 5

NEWS

The United States is expected to announce on Monday that all importers of Iranian oil will have to end their imports shortly or be subject to U.S. sanctions, a source familiar with the situation told Reuters

President Nicolas Maduro is funneling cashflow from Venezuelan oil sales through Russian state energy giant Rosneft as he seeks to evade U.S. sanctions designed to oust him from power, according to sources and documents reviewed by Reuters. 

Russian oil production was around 11.24 million barrels per day (bpd) between April 1 and April 18, an industry source told Reuters on Friday. 

Oil major BP and Azerbaijan's state energy company SOCAR signed an agreement on Friday to build a new exploration platform for the South Caucasus nation's three major oilfields, BP-Azerbaijan said in a statement. 

Qatar Petroleum said on Sunday it had concluded a 10 year sales agreement to supply Thailand's SCG Chemicals with a total of 3 million metric tons of light naphtha starting from this month. 

(Reporting by Florence Tan; editing by David Evans) ((Florence.Tan@thomsonreuters.com; +65 6870 3497; Reuters Messaging: florence.tan.thomsonreuters.com@reuters.net))

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