CRUDE MOC: Dubai structure comes off from 4-month high as sentiment eases

New York — The spread between benchmark cash Dubai against Dubai futures eased from a four-month high on June 19 as sentiment was weighed by talks of Middle East sour barrels coming out of storage.

The Dubai crude cash/futures (M1/M3) spread was assessed at a premium of $1.08/b at the 4:30 pm (0830 GMT) Singapore close on June 19, down 23 cents/b from the day prior when the spread was assessed at $1.31/b -- the highest since January 31, S&P Global Platts data showed.

Sentiment eased in Middle East crude market on June 19 following talks that around 3 million barrels of Murban crude could have been sold from floating storage tankers around Malaysia and heading to India.

Market participants noted that with the Dubai intermonth spreads firmly in backwardation, more barrels could be released from storage.

"I think so [more barrels will come out] at the rate it's going," said a Singapore-based crude trader.

Similarly, the spread between Platts cash Oman and August Dubai futures fell 29 cents/b from a four-month high on June 18 to be assessed at $1.08/b at the Asian close on June 19.

On the Platts Market on Close assessment process, two 25,000-barrel partials of August Dubai traded on June 19 with PetroChina on the sell side and Vitol on the buy side.

This brings the number of partials traded in June so far to 60, consisting of 54 Dubai and six Oman partials. No convergences have been declared yet.

A convergence occurs when 20 partials are traded between two counterparties, resulting in a full 500,000 barrel physical cargo being declared from the seller to the buyer.

For Dubai partials, the seller has the option to deliver a Dubai, Oman, Upper Zakum, Al-Shaheen or, with a quality premium, Murban cargo to the buyer.

For Oman partials, the seller has the option to deliver Oman, or, with a quality premium, a Murban cargo to the buyer.