Qatar leaves May OSPs steady, issues June Al Shaheen tender
Quantum Commodity Intelligence - Qatar's National Oil Company (NOC) has kept Official Selling Prices (OSPs) steady for its Marine and Land grades loading in May, in line with expectations.
QatarEnergy set its Qatar Marine grade for May at a premium of $1/b over Platts Dubai/Oman, unchanged from April barrels, while Qatar Land was set at +$1.40/b, versus +$1.35/b for April.
Since January, Qatar has set OSPs versus Platts Dubai, having previously priced against Platts Dubai/Oman quotes.
The OSPs were largely in line with expectations after Saudi Arabia increased its flagship Arab Light grade to Platts Dubai/DME Oman +$2.80/b for loading next month versus +$2.50/b for April cargoes, while Arab Medium was also increased to +$2.80/b from +$2.50/b.
May Arab Extra Light was set at $2.80/b over Dubai/Oman, versus +$2.70/b for April.
Saudi OSPs were nudged higher after OPEC+ members announced production cuts of around 1.15 million bpd from May, primarily by Middle East producers, including a 500,000 bpd reduction from Aramco.
In line with most Middle East crude grades, Qatari cargoes are sold two months forward but priced against assessments published in the month of loading, so OSPs include two months of market structure.
The key M1/M3 Dubai cash spread, closely monitored by Saudi Aramco and other Middle East National Oil Companies (NOCs), averaged $1.65/b in March and around $1.30/b in the 2H of the month, compared to $2.03/b in February, which would usually flag a reduction in OSPs had it not been for the OPEC+ cuts.
So far in April, the M1/M3 Dubai cash spread has averaged $1.89/b, according to Quantum data, an early indication that Middle East OSPs are heading for only a small adjustment on June-loading cargoes.
Qatar Marine is a medium sour crude (API 32.6, sulfur 1.84%), while Qatar Land is a light-medium crude (API 41, sulfur 1.22%).
Al Shaheen
QatarEnergy also issued a June sell tender for its keenly-watched Al Shaheen grade, with the Middle East medium sour crude expected to sell at similar levels to last month's at around $2/b to the underlying Dubai swap.
Qatar is offering four cargoes for June, rather than the usual three, with one early-month dates, one for mid-month and two for late June dates. Bids close on 12 April and remain valid until 13 April.
Qatar terminated its membership of OPEC in 2019 and has not joined the broader OPEC+ group, so is not subject to production cuts.
Traders said the grade is currently valued at $1.85-$2.10/b over Dubai swaps, with the higher number valid for the prompter dates, reflecting market backwardation.
The regular monthly tender from Qatar is seen as a bellwether for the Middle East medium-sour crude market, as the grade is a component of the Platts Dubai' basket' of crudes, regularly setting the price of Dubai as the lowest of the five deliverable grades into the pricing mechanism.
