Crude oil soars to $125, Middle East benchmark hits highest level since 2018

(1) On Monday, Middle Eastern crude oil benchmark prices continued last week's strong rally, surging to new highs. As the US-Iran conflict continues to escalate, Oman and Dubai crude oil prices jumped above $30 per barrel, reaching the highest level on record since 2018. Meanwhile, as major oil-producing countries cut supply and the market remains concerned about ongoing shipping disruptions, oil prices soared above $119 per barrel, hitting the highest point since mid-2022. (2) Saudi Aramco has unusually conducted a series of tenders, offering more than 4 million barrels of Saudi crude oil. In a tender closing at 5:00 pm (UTC+8) on Monday, Aramco offered 2 million barrels of Arab Heavy crude to be loaded at Egypt's Ain Sokhna port between March 10 and 30, destined for Asia. In another tender that closed on Sunday, Aramco offered 650,000 barrels of Arab Light crude on a cost and freight basis, with the delivery date yet to be determined. In addition, Aramco has sold 2 million barrels of Arab Super Light crude to Japan's Idemitsu Kosan. (3) The Singapore spot market was active, with multiple trades concluded for May-loading Murban and Oman crude. The cash Dubai price spread rose to $31.26 per barrel. Notably, several crude oil transactions were concluded at $125.00 per barrel, with sellers including Phillips 66, BP, Trafigura, Vitol, Shenghong, Shell, and Gunvor, and the buyer in all cases being TotalEnergies. (4) There has been a severe supply disruption. Three industry sources said on Sunday that due to the Iran war making exports through the Strait of Hormuz impossible, daily output from Iraq's main southern oil fields has dropped by 70% to just 1.3 million barrels. On Monday, China raised the maximum retail prices for gasoline and diesel, marking the largest increase since March 2022. Indian refinery stocks were hit as Brent crude rose to its highest level in nearly four years.