DUBAI FUTURES: Spreads rangebound as market awaits more OSPs

Singapore — Intermonth spreads for benchmark Dubai crude futures were rangebound in mid-morning Sept. 8, as sour crude market participants looked toward more official selling prices to come.

The October/November spread was pegged at a contango of 26 cents/b at 11 am in Singapore (0300 GMT), narrowing 2 cents/b from the 4:30 pm (0830 GMT) Asian market close on Sept. 7, S&P Global Platts data showed.

The November/December spread was pegged at a contango of 29 cents/b, narrowing 1 cent/b over the same period.

Market participants were still awaiting the release of more OSPs from other key Middle Eastern producers, including ADNOC and SOMO, in the coming days.

"Saudi Arabia cut prices to Asian buyers, a normal sign of weaker demand in its key market... This follows on from worrying signs of a resurgence in COVID-19 cases in other parts of the world," ANZ analysts said in a Sept. 8 note.

"This has raised concerns that the recent recovery in demand may be halted as the general public remains cautious about extended travel," the analysts added.

The overall crude market remains at risk of downside owing to weak refined product demand and suppressed cracking margins, according to trade sources.

Meanwhile, the November Brent/Dubai Exchange of Futures for Swaps was pegged at 9 cents/b at 0300 GMT, rangebound from 6 cents/b seen at the previous Asian close, Platts data showed.

The largely stable EFS comes from relatively steady Brent price movements in mid-morning trade Sept. 8, as investors remained cautious on recent demand recovery due to coronavirus, or COVID-19 developments.