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Asia crude: May Gulf steady, Apr barrels still held

TOKYO: Spot May-loading Middle Eastern grades were assessed steady on Thursday in a market thinned by the absence of Singapore traders for a public holiday, traders said.

There was talk that another May Oman cargo may have been sold late on Wednesday at five cents per barrel over the MOG price, the same as two previous deals, but this could not be confirmed.

Improving regional refining margins and expectations for increased demand from China helped Oman make a firm start to trade of May cargoes, traders noted.

But caution reigned ahead of Opec's meeting on March 27, when the cartel will decide whether to increase output, and if so by how much and starting when.

A substantial Opec increase could dampen sentiment for medium-heavy grades, supplies of which have been particularly affected by the year-old production cuts.

May Abu Dhabi Murban was also rumoured to have traded, possibly at five to six cents above the ADNOC price. But some traders expressed doubt such a deal had occurred, as they viewed the premium as too high for a starter.

Traders confirmed, though, bidding late on Wednesday for May Murban at plus three to four cents, and said the bidders included a U.S. major.

"It is encouraging to see the major checking the market this early," a potential seller of the kerosene-rich light grade said.

This is especially so for the second quarter when Japanese demand is slack due to a fall in kerosene demand and refinery maintenance shutdowns, he said. U.S. majors are active buyers of Murban.

While May trading was moving faster than expected, the April glut has yet to be drained.

About three full cargoes of April Oman, held by two sellers, remained available.

A total of about 1.8-2.0 million barrels of Basrah Light for April was also said to still be available, possibly held by three sellers, even after the same volume of the Iraqi grade was earlier sold into India, traders said.

Traders said the premium paid in the Indian deal, said to be up to six cents over the official selling price (OSP), was relatively low, and could cause the differential paid for the remaining barrels to fall further.

Also Qatar Marine, Yemeni Masila and possibly Marine were still left for April, at least one cargo of each, traders said.-Reuters