CRUDE MOC: Dubai cash/futures spread falls to two-week low

New York — Benchmark cash Dubai fell for a third consecutive day against Dubai futures, reaching its lowest in two weeks amid thin demand.

December cash Dubai was assessed at a discount of 70 cents/b against same-month Dubai futures at the 4:30 pm (0830 GMT) Singapore close on Oct. 28, down 16 cents/b day-on-day, S&P Global Platts data showed.

The cash Dubai/Dubai futures spread, a key indicator of spot market sentiment for sour crude in Asia, was last lower on Oct. 13 when it was assessed at minus 76 cents/b.

The spread, which is also known as the M1/M3 spread, has fallen back from a recent peak of minus 39 cents/b on Oct. 23 as demand from Asian refiners dissipated following a flurry of purchases last week.

Similarly, Platts cash Oman versus Dubai futures fell 19 cents/b day-on-day to minus 20 cents/b on Oct. 28, Platts data showed.

The Platts Market on Close assessment process in Asia saw two trades of 25,000-barrel partials of December Dubai on Oct. 28.

This brings the total number of partials traded in the MOC in October so far to 75, comprising 73 Dubai partials and two Oman partials.

No further convergences have occurred since a single cargo of Qatar's Al-Shaheen crude oil was declared by Unipec to Mercuria on Oct. 19, after Mercuria bought its 20th December Dubai partial from Unipec.

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.