Qatari crude up as refiners seek cheaper gasoil

DUBAI — Crude oil from Qatar rose as refiners sought middle distillate-rich grades for lower prices than traditional types such as Abu Dhabi’s Murban.

By (Bloomberg)

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Published: Sat 17 Jul 2010, 11:30 PM

Last updated: Mon 6 Apr 2015, 10:37 AM

Qatar Marine for September loading climbed two cents to a premium of seven cents a barrel to its official price, according to data compiled by Bloomberg. Murban fell two cents to a discount of three cents to its official price, Bloomberg data show. Lower Zakum, also produced in the emirate, dropped seven cents to a discount of 13 cents. Qatar Marine has a similar yield of middle distillates including gasoil to both Abu Dhabi grades after basic processing.

The Qatari type is selling at a discount of $1.24 to benchmark Dubai crude for June as opposed to a premium of 81 cents for Murban. Middle East producers retroactively price their sales and refiners will use that as a gauge for future supplies.

Refiners are turning away from the Abu Dhabi grades because of their larger yield of naphtha after processing. Gasoil’s premium to Dubai, a measure of refiner profitability, rose 12 cents to $11.16 a barrel, according to data from PVM Oil Associates Ltd. Naphtha is at a discount of $6.14 to the crude.

Kenya Petroleum Refineries Ltd., the East African nation’s only refiner, is seeking two cargoes of Abu Dhabi’s Murban crude for September arrival, said two traders who participate in the market.

Oman crude for immediate loading fell 58 cents, or 0.8 per cent, to $74.30 a barrel, according to Bloomberg data. Dubai for loading in September dropped 58 cents, or 0.8 per cent, to $73.59. Murban declined 0.8 per cent to $74.37.

Futures of Oman crude for September delivery on the Dubai Mercantile Exchange fell 25 cents to $73.47 a barrel at 4:43pm Singapore time, with 1,128 contracts traded. The settlement price was set at $73.45 at 12:30pm Dubai time.

The Brent-Dubai exchange for swaps for September narrowed eight cents to $2.05 a barrel and the exchange for swaps for October narrowed eight cents to $1.20 a barrel, according to data from brokers PVM Oil Associates. The exchange for swaps is the price difference between Brent and Dubai swaps contracts.

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