AlwaysFree: Middle Eastern Crude Oil Exporters Seen Hiking January OSPs

Middle Eastern crude oil exporters are expected to hike their official selling prices (OSPs) for January loadings amid a rising Dubai structure, trading sources said. However, they noted that OPEC+ output and the emergence of coronavirus Omicron strain could result in moderate increments. These traders expect Saudi Aramco and its regional peers to raise their January OSPs by 50 cents to $1.20 per barrel for cargoes bound to Asia.

The Dubai futures spread averaged $3.38 per barrel in November, up from $2.29 per barrel in October. The spread is a key element in OSP calculations. A trader said Omicron halted the rally in oil prices last week and could dampen the demand outlook. It remains to be seen how much the new virus strain would affect the market, but market participants expect OPEC+ to stick with its plan to raise output by 400,000 bpd.

The sources also said that spot demand for February loadings from China and Japan might ease after these importers replenish their stocks for winter. In addition, China’s independent refiners are grappling with a lacklustre buying appetite under Beijing’s tax scrutiny and emission curbs. The availability of cheaper grades, including sour crude from the release of US strategic petroleum reserves, also adds pressure to the Middle Eastern crude complex.

Tags: AlwaysFree,Crude Oil,English,Middle East