Dubai crude futures steady as Asia awaits further cues from the Middle East

Singapore — Higher-than-expected price hikes by two major Middle East crude producers had crude markets in Asia pausing June 10 to await further official selling prices and monthly crude allocations from other producers for July.

Benchmark Dubai crude futures were largely steady as a result, market participants said early June 10.

The August Dubai crude futures contract stood at $40.19/b at 11 am in Singapore (0300 GMT), up 0.8% from the assessment at $39.88/b at the Asian close on June 9.

Intermonth spreads along the Dubai paper curve were barely changed overnight, with the July/August spread pegged at 5 cents/b on June 10. It had been assessed at 2 cents/b at the 0830 GMT close of Asian trading June 9.

The August/September spread moved down a few notches to be pegged at minus 28 cents/b at 0300 GMT June 10 from the assessment at minus 22 cents/b on June 9.

"Let's see how the nominations go this week," said a China-based trader, referring to the exchange between producers and end-users to determine monthly crude volume requirements. Nominations and subsequent allocations for July-loading crude cargoes will follow the OSPs and are expected to begin in the week of June 7-13.

Saudi Aramco typically finalizes its allocations in Asia around the 10-12th each month, with other producers close behind.

Nominations occur once end-users have received official selling prices for the month. So far, only ADNOC and Aramco have issued their July OSPs, and the market is still awaiting prices from Iraq, Kuwait, and Qatar, among others.

Saudi Aramco on June 7 hiked its July crude export OSPs across the board, for all regions and grades, a day after OPEC and its allies agreed to continue historic production cuts for another month.

ADNOC followed Saudi Aramco's lead, hiking its July OSP for Murban to a premium of $1/b to Platts Dubai crude assessments, up $5.45/b from June.