Dubai crude down 3.5% on week, rebounds from monthly lows

Quantum Commodity Intelligence - Dubai crude finished the week ending 18 March around 3.5% lower, although a strong finish lifted the Middle East benchmark off mid-week lows after global oil markets had previously slumped from 13-year highs.

Front-month Dubai cash for May delivery was assessed by Quantum Friday at $106.61/b, versus $110.50/b on 11 March, up 3.52%, while Tuesday's $99.74/b was the lowest assessment since the first day of the month.

Dubai cash spreads came off sharply as the market structure continued to weaken from last week's record levels.

The key M1/M3 (May22/Jul22) spread, used by NOCs in OSP calculations, was down around $3/b on the week at just above $8/b, while the one-year curve was down around $5/b at just below $20/b.

Premiums for Middle East flagship grades were also seen lower, with the likes of Oman, Upper Zakum and Al Shaheen at just above $8/b over Dubai swaps versus around +$12/b a week earlier.

But the first tranche of Russian ESPO cargoes failed to materialize this week, leading to expectations that a reduced program will now likely be sold via private negotiations, rather than the usual tender process.

ICE Brent futures for May22 were pegged $108.16/b on the Singapore close Friday, down $3.09/b on the week, widening the Brent/Dubai cash spread for May to $1.55/b compared with $0.75/b last Friday.

The Brent/Dubai EFS however narrowed, largely a function of the Dubai backwardation, with May assessed at $9.67/b versus $12.13/b last week.

DME Oman futures closed the week 3.54% lower at $106.65/b for the May22 contract, largely shadowing cash Dubai.

Light sweet Murban crude trading on Abu Dhabi's IFAD exchange closed the week at $108.12/bb, down 3.4% on the week and valuing Murban at near parity to Brent.