Middle East crude benchmarks jumped on Wednesday as Saudi Arabia and Russia prolonged their supply reduction for another three months, which would further tighten crude supply, especially sour grades, in global market.

Saudi Arabia, the world’s top oil exporter, and Russia on Tuesday said they would extend voluntary oil cuts to the end of December 2023, despite a rally in the oil market and analyst expectations of tight supply in the fourth quarter.
Saudi Arabia will roll over its voluntary oil output cut of 1 million barrels per day (bpd), while Russia will voluntary cut its oil exports by 300,000 bpd.

SINGAPORE CASH DEALS

Cash Dubai’s premium to swaps rose 31 cents to $2.15 a barrel.

No trade was done at Platts window on Wednesday.

NEWS

The G7 and allies have shelved regular reviews of the Russian oil price cap scheme, people familiar with the matter told Reuters, even though most Russian crude is trading above the limit because of a rally in global crude prices.

Russia’s oil and gas revenues in August were almost 21% lower than in July at 642.7 billion roubles ($6.6 billion), finance ministry data showed on Tuesday, amid rising subsidies to oil refineries and a cyclical fall in profit-based tax.

Refiners globally are expected to run at near full capacity in the near term to seize strong margins while crude oil supply remains tight, a senior official from Equinor said at an energy conference in Singapore on Tuesday.
Source: Reuters (Reporting by Muyu Xu; Editing by Shinjini Ganguli)