Middle East Crude-Murban inks monthly increase, opens window for AXL OSP hike

Light sour benchmark Murban retreated on the last trading day in October as the Brent/Dubai EFS narrowed, but its average premium rose from the prior month, buoyed by supply disruption concerns following geopolitical tensions in the Middle East.

Spot premiums for Murban averaged at $3.88 a barrel over the Dubai quotes in October, up from $3.43 a barrel in September, which signals that regional kingpin Saudi Aramco could raise the official selling price (OSP) of its Arab Extra Light crude (AXL) in December.

Saudi Aramco typically takes cues from Murban’s structure when setting prices for AXL.

OSP
The official selling price (OSP) for Oman crude in December will fall by $2.98 to $89.79 a barrel, Reuters calculations based on data from the Dubai Mercantile Exchange (DME) showed on Tuesday.

The December Oman OSP is the average of daily Oman settlements at 0830 GMT in October for the front month contract 1OQc1.

The Dubai crude OSP, set at a $0.05 per barrel premium to DME Oman, was calculated at $89.84 a barrel for December.

SINGAPORE CASH DEALS
Cash Dubai’s premium to swaps rose 6 cents to $1.65 a barrel.

A total of 12 convergences were made at Platt’s Dubai partial window, including nine cargoes of Oman crude and one cargo each of Dubai, Upper Zakum and al-Shaheen crude.

NEWS
At least three Chinese companies including state giant China National Offshore Oil Company (CNOOC) are evaluating Shell’s Singapore assets and considering non-binding bids in coming weeks for the city-state’s oldest refinery, according to several sources familiar with the matter.

India’s crude oil imports fell for a fourth month in September, to their lowest in a year, Petroleum Planning and Analysis Cell (PPAC) data showed on Tuesday.

China’s refined fuel demand is expected to grow at more than 10% in the fourth quarter versus a year earlier, the President of PetroChina 0857.HK 601857.SS Huang Yongzhang told an online roadshow on Tuesday after the firm announced a record quarterly earning on Monday.

The World Bank said on Monday it expected global oil prices to average $90 a barrel in the fourth quarter and fall to an average of $81 in 2023 as slowing growth eases demand, but warned that an escalation of the latest Middle East conflict could spike prices significantly higher.
Source: Reuters (Reporting by Muyu Xu; Editing by Mrigank Dhaniwala)