Higher Oil Availability Pressures Middle East Crude Benchmarks

AI Summary

Increased crude flows from the Middle East have weakened the region’s physical oil-market benchmark, with the Oman-Dubai differential falling to $4.22 per barrel, its lowest level since late July. The spread had surged to $65 in March when Strait of Hormuz disruptions sharply restricted cargo movements.

Robust crude oil flows out of the Middle East in recent weeks have started to pressure the key metric of strength for physical supply out of the region. The premium of Oman crude over Dubai, the measure of Middle East’s market strength, has slumped this week to the lowest level since the end of July, to $4.22 per barrel, according to data by General Index cited by Bloomberg. The Oman-Dubai crude differential had soared to as high as $65 in March when the Strait of Hormuz was at a virtual closure and no crude cargoes were moving out of the…