Singapore — Intermonth spreads for benchmark Dubai crude futures narrowed slightly during mid-morning trade in Asia July 6, as expectations of upcoming producer price hikes continued to keep sentiment tepid.
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At 11 am in Singapore (0300 GMT), the August/September Dubai crude futures spread was pegged at a 17-cent/b backwardation, narrowing 4 cents/b from the Asian close on July 3, S&P Global Platts data showed.
The September/October spread was pegged at a backwardation of 8 cents/b, narrowing a cent/b from the Asian close on July 3.
Saudi Aramco is expected to raise the official selling price differential for its Arab Light crude bound for Asia in August by between 80 cents/b and $3/b, participants surveyed by Platts said last week.
The expectation comes amid an uptick in the Dubai cash-futures spread in recent weeks. The spread averaged 84 cents/b over June, up $3.57/b from the average of minus $2.73/b in May. The spread was assessed at $1.01/b at the Asian close on July 3.
Nonetheless, some market participants have highlighted that refinery margins remained weak and that this could dampen buying interest in view of potential hikes.
At the moment, the market continues to look towards the issuance of new OSPs from Saudi Aramco, which was earlier expected to be released over the weekend, trade sources said on July 3.
Meanwhile, crude oil futures markers firmed in Asia trading on July 6, amid progress in compliance to OPEC+ production cuts.
Iraq's crude oil exports fell to 3.083 million b/d in June -- a 497,000 b/d drop from May and the lowest in more than five years -- indicating significant progress in implementing its cuts, Platts had reported.
September Dubai futures were pegged at $42.05/b as of 0300 GMT July 6, up 36 cents/b compared with the Asian close on July 3, Platts data showed.