CRUDE MOC: Murban at new low versus Dubai futures ahead of OPEC+ talks

Singapore — Abu Dhabi's Murban crude fell Wednesday to its lowest level against Dubai futures since at least July 2018, as traders in Asia braced for less than satisfactory production cuts emerging from OPEC+ talks scheduled for Thursday, sources said.

June cash Murban was assessed at June Dubai futures minus $9.55/b at the end of the Platts Market on Close assessment process for Middle East sour crude. That was the lowest level since S&P Global Platts began publishing the differential in July 2018.

Murban, a light sour grade produced onshore in the UAE's Abu Dhabi emirate, is typically priced at a premium to other medium and heavier high sulfur crude grades in the region due to its high yield of diesel and naphtha and low yield of residual products.

The grade is also tracked as an unofficial marker of light sour crude value in Asia, helping crude market participants peg spot market prices for other light crudes such as Qatar Land, Das Blend or Umm Lulu.

Spot market differentials of lighter Middle East crudes, including Murban, have slipped sharply in recent weeks in tandem with cratering refining margins for premium products such as gasoline and jet fuel.

Global aviation demand for jet fuel remained in the doldrums due to the impact of travel restrictions imposed to combat the spread of COVID-19.

The number of commercial airline flights is down 75% globally from pre-pandemic norms, according to S&P Global Platts Analytics.

China's international commercial flights have plunged to around 85 per day from 2,965 per day prior to the pandemic, due to continuing restrictions on entering and leaving the country, Platts Analytics said.

Meanwhile, the Platts MOC for Middle East crude saw a total of 11 partials change hands Wednesday. Eight were June Dubai partials, and three were June Oman trades.

To date in April, a total 24 partials have traded on the MOC, comprising four Oman and 20 Dubai partials.

Additionally, spot market activity for physical, June loading cargoes of Middle East sour crude was expected to pick up after the OPEC+ talks.

OPEC, Russia and nine other allies plan to hold a virtual summit Thursday to finalize a deal, and additional invitations have been sent to the US, Argentina, Brazil, Canada, Chad, Colombia, Ecuador, Egypt, Indonesia, Norway, Trinidad & Tobago and the UK, according to OPEC sources.

The OPEC+ webinar summit is scheduled to start at 1400 GMT Thursday, followed by a G20 meeting on Friday led by Saudi Arabia. which holds the G20's rotating presidency this year.