Middle East Crude-Benchmarks gain amid brisk open window activity

Middle East crude benchmarks Oman, Dubai and Murban climbed for the first session in four on Wednesday as trading momentum in the open window turned even more brisk amid bullish near-term expectations.

Some traders were still bullish given the ongoing strong performance in the downstream gasoline markets, with refining margins for the motor fuelstill hovering close to $9 a barrel levels, supporting gains in the overall complex refining margins.

While some analysts were still concerned about Chinese demand given the falling import volumes for crude in the past four months, two China-based traders said that the maintenance season fromOctober to November will be less heavy than from April to June.

Dubai prices may be supported in the near term because of better offtaking from China, one trade source said. Middle East flows to northeast Asia already rebounded to a two-month high for July so far, Kpler shiptracking data showed.

Meanwhile, flows from the U.S. and west Africa to northeast Asia could be curtailed in the near term because of better seller margins to the west of Suez markets, and Asian buyers will have to digest Middle East supplies for now, two sources said.

The exchange of futures for swaps, which istypically a rough market gauge for east-west arbitrage price differences, closed at a three-session high of $1.61 a barrel.

SINGAPORE CASH DEALS

Cash Dubai’s premium to swaps rose 1 cent to $1.67 a barrel.

NEWS

– U.S. crude oil and gasoline inventories fell last week while distillates rose, according to market sources citing American Petroleum Institute figures on Tuesday.

– Global oil demand will outpace supply next year, the U.S. Energy Information Administration said on Tuesday, reversing a prior forecast for a surplus.

– Nigeria’s NNPC is in talks for another oil-backed loan to boost its finances and allow investment in its business, its chief executive told Reuters, as pressure mounts on the state-backed oil company the economy depends upon.
Source: Reuters (Reporting by Trixie Yap and Florence Tan; Editing by Eileen Soreng)