Middle East crude benchmarks Oman, Dubai and Murban advanced on Wednesday over robust spot trades and as Saudi Aramco’s CEO predicted tight supply in the market after inventory depletion.

The spread between Brent- and Dubai-linked grades has widened to $1.48 a barrel, comparing to an average of around $0.5 over the past two months. A wider spread would make hauling arbitrage cargoes less attractive to Asian refiners.

In an exclusive interview with Reuters, Saudi Aramco’s CEO Amin Nasser said that global oil markets will cope with Red Sea disruptions in the short run, although prolonged attacks by the Houthis on ships would lead to a shortage of tankers due to longer voyages and a supply delay.

The oil market will tighten after consumers depleted stocks by 400 million barrels in the last two years, which left OPEC’s spare capacity as the main source of additional supply to meet rising demand, he said.

In spot market, China’s mega refinery Rongsheng bought 1 million barrels each of Basra Heavy and Das crude in its monthly tender, likely for March and April delivery. But the prices of the deals were unclear.

The market was still waiting for the tender results from Qatar Energy that was seeking to sell four al-Shaheen cargoes, one cargo each for Qatar Marine and Qatar Land, all for March-loading.

Taiwan’s CPC is seeking to buy Middle Eastern sour crude for March-loading. The tender will be valid until Thursday evening.

SINGAPORE CASH DEALS

Cash Dubai’s premium to swaps rose 2 cents to $1.03 per barrel.

NEWS

China’s oil refinery throughput in 2023 rose 9.3% from a year earlier to a record, reversing a rare decline in 2022, as new plants in the world’s second-largest crude consumer bolstered production to meet a post-pandemic recovery in fuel demand.

U.S. oil output from top shale-producing regions is due to decline in February for the fifth consecutive month, the U.S. Energy Information Administration (EIA) said in a monthly report on Tuesday.

Supply cuts by OPEC+, costly shipments from some traditional Middle East suppliers and geopolitical tension is driving India, the world’s third-biggest oil importer, to diversify its crude sources and accelerate its energy transition, its Oil Minister Hardeep Singh Puri said.

Thailand has ordered traders to suspend diesel exports while Thai Oil PCL TOP.BK repairs its No. 3 crude distillation unit in Chonburi province, a government official said on Wednesday.
Source: Reuters (Reporting by Muyu Xu; Editing by Shilpi Majumdar)