Middle East crude benchmark premiums of Oman, Dubai and Murban slid on Wednesday, reaching the lowest in about a month.

The recent downtrend came after a surge in spot premiums driven by U.S. sanctions on Russia that tightened shipping availability and sent Asian buyers to seek more alternative barrels from the Middle East and other regions.

But sharply increased prices have reduced demand to some extent, and trading has remained light during the Lunar New Year holiday.

SINGAPORE CASH DEALS

Cash Dubai’s premium to swaps fell 9 cents to $3.26 a barrel.

NEWS

The amount of Russian and Iranian oil held on ships has hit multi-month highs as harsher U.S. sanctions reduced the number of buyers, leaving fewer tankers available to deliver cargoes and driving up crude costs, trade sources and analysts said.

U.S. oil production is poised to set a larger record this year than prior estimates, the U.S. Energy Information Administration (EIA) said on Tuesday in its Short-Term Energy Outlook report, but it maintained its estimate for demand growth.

Chevron’s CVX oil and gas reserves have fallen to the lowest point in at least a decade, highlighting the importance of the U.S. major’s planned acquisition of oil producer Hess that has stalled due to a court battle with Exxon Mobil XOM.

Decisions made by oil producer group OPEC take a long-term view of the global markets and are aimed at providing price stability, Secretary General Haitham Al Ghais said at the India Energy Week conference on Tuesday.
Source: Reuters