Dubai futures contango narrows as sour crude activity gathers pace

Singapore — The contango in benchmark Dubai crude futures had narrowed at midday in Asia trade Sept. 16 from the previous session amid an uptick in activity in the sour crude market.

At 12 pm Singapore time (0400 GMT), the October/November timespread was pegged at a contango of 33 cents/b, up 6 cents/b from the Asian close on Sept. 15, S&P Global Platts data showed. The November/December timespread was pegged at a contango of 37 cents/b, also up 6 cents/b over the same period.

The Dubai market structure has firmed after stronger pre-tender prices were heard traded for Al-Shaheen crude.

November-loading Al-Shaheen was heard to have changed hands at discounts of 40-50 cents/b to Platts Dubai assessment on an FOB basis, though further details could not immediately be confirmed. QPSPP's November-loading tender closed Sept. 15 with validity until Sept. 16, market sources said.

Last month, QPSPP offered two 500,000-barrel Al-Shaheen cargoes for loading in October, selling at discounts of 58 cents/b and 64 cents/b to Platts front month Dubai, FOB.

Other tenders have also emerged in the market. Taiwan's CPC is seeking sour crude for November loading in a tender that closes Sept. 16 with validity until Sept. 18, according to the company's website.

Meanwhile, the prompt-month Brent/Dubai Exchange of Futures for Swaps spread has steadied in negative territory. The November EFS was pegged at minus 19 cents/b at midday Sept. 16, unchanged from the Asian close Sept. 15, Platts data showed.