Middle East crude complex steadies as buying momentum picks up

Singapore — Benchmark Dubai crude futures and timespreads were steady to a touch softer in mid-morning trades Wednesday, with several buy-side tenders emerging this week in the bustling Middle East spot market.

At 11 am Singapore (0300 GMT), the June/July Dubai futures timespread was pegged at minus 32 cents/b, coming off slightly from the minus 31 cents/b assessed at the 4:30 pm close in Singapore Tuesday.

Similarly, the July/August spread for Dubai crude futures ticked a few notches lower to be pegged at minus 37 cents/b Wednesday morning. It had been assessed at minus 31 cents/b at Tuesday's close.

Still, the intermonth spreads were largely moving within a steady range, as they have for most of the week, despite outright crude futures prices easing after an initial rally that saw Dubai and Brent futures surge past the $30/b in recent days.

July Dubai futures was pegged at $35.01/b Wednesday morning, coming off from $35.18/b assessed at Tuesday's Asian close. Similarly, July ICE Brent futures were down at $34.71/b at 11 am Wednesday in Singapore, compared to $34.99/b at 4:30 pm Tuesday.

In the spot market, market participants were awaiting the conclusion of several buyside tenders going on at the moment, they told Platts.

Thailand's PTT was seeking several cargoes of light and medium sour crude for July loading via its monthly spot tender, participants told Platts.

Additionally, China's Rongsheng -- an independent refiner -- was also out on the spot market with a buy-side tender, said market sources. The refiner typically buys a mix of medium sour crudes such as Oman and Upper Zakum. It was previously seen purchasing several million barrels of Oman crude loading over May via a similar tender.

Activity for Russian crudes also picked up toward the second half of the month, with several July loading cargoes of ESPO sold via a Surgut spot tender earlier this week, market sources told Platts.

Price differentials for the medium sweet grade have risen sharply since last month, when ESPO traded in discounts, said traders.

July loading cargoes of the grade -- a favorite among China's independent refiners -- shot up to premiums of between $2.50/b and $3/b over Platts front-month Dubai crude assessments, tender results showed.

Last month, ESPO traded in deep discounts of around minus $4.50/b to minus $5/b under Dubai, for similar cargoes loading over June.