SINGAPORE, Oct 4 (Reuters) - The Middle East crude market strengthened on Thursday, buoyed by larger than expected increases in official selling prices (OSPs) from Saudi Arabia and Abu Dhabi. A tender from Taiwanese refiner Formosa seeking either Basra Light or Russian Urals for December delivery could provide more price cues for these grades, although traders said the arbitrage window for Urals to be shipped to Asia is closed. *OSPs - Top oil exporter Saudi Arabia has raised its Arab Light crude price for Asian buyers in November by 90 cents, its state-owned company Saudi Aramco said, higher than traders' forecast of 60 cents a barrel in a Reuters poll. "The strong hikes seen for Asia reflect the wider backwardation in the cash Dubai intermonth spread, which came on the back of increased buying interest from core Asian buyers that are finishing up maintenance," JBC Energy analysts said in a note. The consultancy expects about 600,000 barrels per day (bpd) of refining capacity to be shut in November compared with more than 1.5 million bpd in the previous month. "At the same time, we expect to see refining capacity additions of around 585,000 bpd in the fourth quarter," it said. Yet traders were baffled by the 80-cents-a-barrel rise for Arab Medium and Heavy as fuel oil cracks were little changed from the previous month. The larger than expected rise in Saudi OSPs are likely to push up the spot premiums of competing grades such as Oman and Russia's Sokol, ESPO and Vityaz. It could also depress the spot differential for December Banoco Arab Medium, down from the 40-50 cents a barrel premiums fetched for November cargoes. - Abu Dhabi National Oil Co. has raised the September retroactive official selling price (OSP) for its key Murban crude by $3.75 from August to $115.40 a barrel, ADNOC said. This sets Murban at $4.18 a barrel above Dubai quotes, up $1.12 a barrel in premium from the previous month, more than market's expectation of a 90-cents-a-barrel rise. Murban is still competitive when compared with Saudi grades. With a rally in middle distillates cracks, Murban could still trade at premiums to its OSP for December. *TENDERS - Taiwanese refiner Formosa Petrochemical is seeking 2 million barrels of Basra Light or Russian Urals for delivery on Dec. 15-25. The tender will close on Oct. 5. - Yemen offered 2.6 million barrels of Masila crude for December loading in a tender to close on Oct. 5. *TRADES - Mercuria sold a Dubai partial to Gunvor at $106.55 a barrel. Gunvor bought a partial from Mercuria at $106.35 a barrel. *MARKET NEWS - Saudi Oil Minister Ali al-Naimi said on Thursday Saudi Arabia and OPEC were ensuring the international market remains well supplied and that the oil price does not get out of control, adding that additional demand can and will be met. - Kazakhstan plans to begin processing some of its crude oil in China this year to make up for a shortfall in domestic refining capacity, a senior government official said. Deputy Oil and Gas Minister Bolat Akchulakov said Kazakhstan planned to send between 1.0 million and 1.5 million tonnes of crude per year for processing in western China. Light oil products would be delivered back across the border. CRUDE Price Prev Change DEC DME Oman diff to Dubai swaps +1.41 +1.46 -0.05 NOV Brent 108.84 110.67 -1.83 DEC Dubai 104.80 106.83 -2.03 DEC DME Oman 106.21 108.29 -2.08 NOV Brent/Dubai EFS 3.40 3.20 +0.20 PRODUCT CRACKS NOV fuel oil crack -6.38 -6.78 +0.40 NOV gasoil crack +19.68 +19.07 +0.61 NOV naphtha crack -7.62 -7.56 -0.06 COMPLEX REFINERY MARGINS Today 10.32 Last 5 days 9.65 Last 365 days 7.41

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