Bloomberg News

Dubai Crude Oil Discount Widens; Middle East Premiums Shrink

October 27, 2011

Oct. 27 (Bloomberg) -- Dubai crude, a benchmark grade for Persian Gulf oil sold to Asia, will sell at a record discount to the Oman grade in January. Middle East crude premiums shrank.

Dubai oil loading in January next year will cost 65 cents a barrel below the November official selling price for Oman futures, the Dubai Mercantile Exchange said today in an e-mailed statement. That’s the biggest discount since Dubai was priced in relation to Oman crude in September 2009. Last month’s discount was 45 cents.

The Dubai Mercantile Exchange, where Oman futures contracts are traded two months forward, provided today’s price from Dubai’s Department of Petroleum Affairs. The department issues its formula for Dubai crude on the last Thursday of every month.

Oman futures for December delivery rose 67 cents to $107.07 a barrel on the Dubai Mercantile Exchange at 4:34 p.m. Singapore time with 1,232 contracts traded. The settlement price was $107.04 at 12:30 p.m. in Dubai.

Murban crude, produced by Abu Dhabi National Oil Co., dropped 2 cents to a premium of 22 cents a barrel above its official selling price, according to data compiled by Bloomberg. Upper Zakum’s premium narrowed 7 cents to 51 cents while Qatar Marine dropped 9 cents to 58 cents.

The December Brent-Dubai exchange for swaps, which measures the European marker contract against the Persian Gulf grade, fell 73 cents to $4.97 a barrel, according to PVM Oil Associates, a broker. That’s the lowest in three weeks. The exchange for swaps for January shrank 55 cents to $4.57.

--With assistance from Alexander Kwiatkowski in Singapore. Editors: Alexander Kwiatkowski, Mike Anderson

To contact the reporter on this story: Yee Kai Pin in Singapore at

To contact the editor responsible for this story: Alexander Kwiatkowski at

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