CRUDE MOC: Dubai structure at one-week low as market awaits allocations

New York — The Dubai crude cash/futures (M1/M3) spread eased to a one-week low on June 12 as market participants continue to await for crude oil allocations from Middle East producers, market participants told S&P Global Platts.

The spread -- a key indicator of spot market sentiment for sour crude in Asia -- was assessed at a premium of 62 cents/b at the 4:30 pm (0830 GMT) Singapore close on June 12, down 12 cents/b from 74 cents/b assessed on June 11.

It is the third consecutive day that the Dubai M1/M3 spread has fallen, having eased from a four-month high of 93 cents/b on June 9, Platts data showed.

Market participants attributed the lower Dubai M1/M3 spread to easing market sentiment ahead of the issuance of allocations for July-loading barrels from Middle East producers.

"Market will not be so strong unless Saudi cut [allocations] dramatically," said a North Asian crude oil trader.

In addition, weak refining margins will weigh on the sentiment even as demand was expected to emerge from refineries across Asia, trade sources said.

On the Platts Market on Close assessment process, a total of five 25,000 partials traded on June 12. These consisted of four August Dubai partials and a single August Oman partials.

Oil major Shell was seen to have purchased three Dubai partials - two from Hengli and one from Unipec - and one Oman partials from Unipec. Western trading house Vitol was also seen to have purchased a single Dubai partial from Hengli.

Including the partial trades on June 12, a total number of 34 partials have been traded in June so far, consisting of 32 Dubai and two Oman partials. No convergences have been declared yet.