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Middle East oil grab hits fever pitch as supply squeeze persists

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Buyers across the world’s top oil-importing region are scrambling for oil as US sanctions on Iran and Venezuela tighten supplies of high-sulphur crude that their refineries are designed to process.

Monday 13, May 2019

(Bloomberg) --Oil refiners across Asia are bidding up crude prices from Abu Dhabi to Oman as they compete for supplies to make up for lost Iranian and Venezuelan exports.

July-loading cargoes of grades such as Murban and Das were bid at premiums of 80 to 85 cents a barrel above the official selling price last on an electronic trading platform operated by S&P Global Platts.

Upper Zakum crude was also bid at a 65-cent premium, while Umm Lulu changed hands at a 95-cent premium. The higher bids came even after Abu Dhabi National Oil Company hiked the official price of its crude earlier last week.

Unplanned disruptions to Russian and Nigerian flows and concerns that fighting in Libya could affect oil exports also contributed to the fervour to secure cargoes.

Oman crude futures climbed to a premium of $3.10 a barrel over swaps for Dubai oil, the benchmark grade for the Middle East. that is its highest premium since September, when markets were spooked by the prospect of US sanctions putting an end to Iranian exports.

A wide discount between the Dubai benchmark and Brent, the marker for more than half the world’s oil supplies, is also contributing to the strong interest for Middle Eastern grades.

TAGS : ADNOC, Murban, Das, Upper Zakum crude, Umm Lulu

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