Crude MOC: Crude traders bet on Murban rebound amid pricing impasse

Singapore — Crude traders bet on a rebound in spot price differentials of Abu Dhabi's Murban crude Thursday, attempting to procure cargoes of the light sour grade in the Platts Market on Close assessment process ahead of further price cuts expected from ADNOC.

Bids placed by traders Glencore and Gunvor in Thursday's MOC put spot price differentials for Murban and Das Blend on an upward trajectory and away from minus $2/b levels being quoted by buyers earlier in the week.

Gunvor bid for a 500,000 barrel clip each of Murban and Das Blend, for May loading and on B/L month pricing terms, while Glencore's bid for a 500,000 barrel cargo of May loading Murban did not stipulate any additional terms. All three bids were priced against the Murban OSP.

Glencore's bid for Murban began at minus $2.10/b -- the same level at which BP had reportedly sold a cargo to Chevron in the spot market earlier this week. The bid rose up to minus $1.30/b against the OSP.

Meanwhile, Gunvor initial bids for both cargoes came in at minus $1.80/b against the OSP, but the trader bid up aggressively to land at minus 30 cents/b differentials by the end of the MOC at 4:30 pm in Singapore (0830 GMT).

No selling interest was seen for the bids despite the sharp uptick in prices from multi-year lows seen just days earlier. Sellers of ADNOC's light sour crudes are likely to hold back from spot market deals until further clarity emerges on the fate of its official selling prices this month, market sources said.

ADNOC on Wednesday said it would issue prospective OSPs for March and April "in response to market conditions, and to provide better forward visibility to our customers," after market participants expressed dissatisfaction with its pricing in comparison to deep cuts issued by other Middle East sour crude producers.

Meanwhile, the Dubai M1/M3 continued to plunge to new depths Thursday, being assessed at minus $2.57/b at the end of the MOC at 4:30 pm Singapore time (0830 GMT). The spread was down from minus $2.405/b assessed on Wednesday.

Spot market sentiment remained bleak for Middle East sour crudes as term holders finalized monthly nominations with producers such as Saudi Aramco. With Aramco and a host of other term volume sellers cutting prices to record lows for April loading barrels, refiners in Asia are expected to seek fewer cargoes from the spot market this month.