Middle East crude benchmark spot premiums for Oman, Dubai, and Murban experienced a decline over the week. This drop coincided with OPEC+’s decision to increase output for July and Saudi Arabia’s move to reduce official selling prices to Asia.
In Singapore, cash Dubai’s premium to swaps saw an uptick of 21 cents, settling at $1 per barrel. Despite the overall decline in premiums, this slight increase indicates varying dynamics within the market.
Additionally, there are notable shifts in the strategies of key players in the region. India’s two major private-sector refiners, historically focused on exporting, are now pivoting towards local sales.
This decision is driven by a decline in global demand, which has adversely affected offshore profit margins. As a result, these refiners are making inroads into India’s rapidly expanding fuel retail market, valued at approximately $150 billion.
In other developments, Petrobras, Brazil’s state-run oil giant, is shifting its focus towards Africa as a key area for expansion outside of Brazil. The company’s CEO shared insights into this strategic direction during a recent interview, emphasizing the potential in African markets.
Meanwhile, Indonesia’s Pertamina is actively seeking to procure up to 1.2 million barrels of term gasoline cargoes each month for delivery scheduled between July and September. This move reflects Pertamina’s increased purchasing activity, marking its second tender within the month.
Overall, while the Middle East crude benchmarks faced setbacks, regional dynamics and strategic decisions among major players illustrate a nuanced landscape in global oil markets.