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COMMENT
The Official prices from Saudi Arabia for September, which were released on Wednesday, were viewed as competitive, particularly for medium and heavy grades. However, increases in differentials against Oman/Dubai quotes for lighter grades, such as Berri (Arab Extra Light), narrowed the spread against Murban and were expected to buoy buying interest for light sour Abu Dhabi barrels.
Cuts to values for medium and heavy Saudi grades were expected to place further pressure on spot cargoes of grades such as Oman. Oman and Dubai values have already been adversely impacted by the unscheduled shutdown of the 540,000 bbl/day Mailiao refinery in Taiwan operated by Formosa Petrochemical Corp (FPCC). FPCC was reported to have recently unloaded a VLCC of Oman crude and placed the barrels into storage in Taiwan.
Tasweeq, the state owned Qatari oil marketer, issued both spot and term tenders offering Deodorised Field Condensate (DFC) and Qatari Low Sulphur Condensate (LSC).
The spot tender offering is for four 500,000 bbl cargoes of Deodorised Field Condensate (DFC) and Qatari Low Sulphur Condensate (LSC) for October loading. The cargoes are for loading 1-8 October, 8-15 October, 15-22 October and 22-31 October. The tender will close on 22 August with validity until 25 August.
The term tender offered either one or two 500,000 bbl cargoes per month of DFC and LSC for loading 1 October 2011 to 30 September 2012. The spot term tenders will also close on 22 August and have validity until 25 August.
October Oman was assessed 8 cents lower at Dubai quotes minus 39 cents, based on Thursday’s DME settlement price.
In open market trading, October Dubai partials were bid at 107.15 by Phibro, while offered at 107.20 by Unipec and SK Energy. October Oman partials were offered at 107.80 by Unipec, but there was no bid.
The October DME Oman futures contract settled at 107.50, down 2.36 on the previous session. The October ICE Middle East Sour Crude marker was set at 107.76, down 2.69.
The September Brent-Dubai EFS was quoted at plus 5.50, down around 25 cents on the previous session. The October Brent-Dubai EFS was assessed at plus 5.10, down around 15 cents.
