CRUDE MOC: Sour complex steady amid stable demand cues in Asia

The sour crude complex was largely steady at the Asia close Dec. 20 amid stable demand heard from Asian refineries for Middle Eastern crude.

S&P Global Platts assessed February cash Dubai versus same-month Dubai futures at a premium of $1.61/b on Dec. 20, 4 cents/b down from the Dec. 17 close, while February cash Oman was also assessed at a premium of $1.61/b at close on Dec. 20, also dipping 4 cents/b from the Dec. 17 close.

Demand cues from Asian end-users are steady, though market participants remain cautious as rising cases of the omicron variant of COVID-19 globally could affect demand moving forward.

"People [in Asia] seem to keep buying normally still," said one crude oil trader based in Southeast Asia. "Demand with omicron is easy to doubt."

In fresh trading activity, two 100,000 mt cargoes of February-loading ESPO crude were heard awarded via tender by Russia's Surgutneftegaz to trading houses at premiums around the low $3s/b to Platts Dubai, on an FOB basis, rising marginally from earlier traded premiums heard around high $2s/b to Platts Dubai, FOB, sources said.

"I think demand is ok though in Asia, not from teapots [but] seems India, Thailand and Japan demand seems ok," said the trader.

While Chinese independent refineries tend to be key buyers of ESPO crude, buyers from other regions seem to have stepped in to fill the gap left by their tepid demand this trading cycle, sources said.

Meanwhile, values for Abu Dhabi's Murban crude continue to rise in line with a strengthening IFAD Murban differential.

At the Asia close on Dec. 20, the February IFAD Murban differential was assessed at $3.98/b, up from $3.30/b on Dec. 17 close, Platts data showed.

In the Platts Market on Close assessment process, a total of 16 Dubai partials and 3 Oman partials traded.

The Dubai partials were traded with Reliance, Unipec and Vitol on the sell side and TotalEnergies, Koch, Mitsui, Gunvor, Shell, PetroChina and Lukoil on the buy side. The Oman partials were sold by Unipec to TotalEnergies. This brings the total number partials traded in December to 184.

Two convergences were also declared on the MOC process on Dec. 20.

Unipec and Reliance declared declared a cargo each of Oman crude to TotalEnergies upon the convergence of 20 Dubai partials.

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.