Murban Crude Rises; Abu Dhabi Increases Official Selling Price

The premium for Murban crude rose against its benchmark amid an increase in official selling prices by producers.

Murban (PGCPMURB) for May loading climbed 8 cents to 11 cents a barrel more than its official selling price, the highest since March 1, according to data compiled by Bloomberg News. Lower Zakum, also produced in the Emirate, climbed 9 cents to a premium of 6 cents a barrel, the data showed.

Abu Dhabi National Oil Co., the state-owned producer, increased the official Murban price to $120.45 a barrel for February, up 5.5 percent from January, according to an e-mailed statement from the company. That reduced the grade’s premium to Dubai, a Persian Gulf benchmark for Asian refiners, during the month as assessed by Platts by 12 cents to $4.28 a barrel, according to Bloomberg calculations.

Dubai crude’s backwardation, when the price for prompt delivery is greater than for later shipment, rose by $1.01. Swaps for April were $2.50 cents a barrel more than June, according to data from PVM Oil Associates Ltd., a London-based broker. A wider backwardation implies stronger refiner demand for immediate oil.

The April Brent-Dubai (PVMMDBSP) exchange for swaps, which measures the European benchmark’s premium against the Middle East grade, fell 13 cents to $3.77 a barrel, the third day of declines and the lowest since Feb. 27, according to PVM data. The May contract fell 11 cents, to $3.95.

Adnoc Shipments

Adnoc will ship all of its contracted volumes to buyers in Asia for April, said three refinery officials on March 5 who were notified by the Middle East producer of its plans.

April will be the second month in a row the company has provided the full volumes. The company is supplying 100 percent of contracted amounts in March, the first time in 10 months. Persian Gulf oil producers such as Abu Dhabi sell their crude to refiners under long-term agreements that allow the buyer to ask for more fuel or the seller to hold back some quantities.

There were no Dubai partials sold today, according to a survey of traders who monitor the Platts pricing window. Bids and offers were off by 30 cents, with Royal Dutch Shell Plc (RDSA) offering to buy as $121.50 and South Korea’s SK Innovation Co. (096770) selling at $121.80. No trades have been done so far in March. Gazprom OAO (GAZP) bid $133.20 for Minas but there were no sellers.

Oman crude for May rose 25 cents at $122.02 on the Dubai Mercantile Exchange at 5:35 p.m. Singapore time with 1,248 contracts traded. The contract settled at $122.45 at 12:30 p.m. Dubai time.

To contact the reporter on this story: Ramsey Al-Rikabi in Singapore at ralrikabi@bloomberg.net

To contact the editor responsible for this story: Alexander Kwiatkowski at akwiatkowsk2@bloomberg.net

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