Middle East oil benchmarks hit record highs as war cuts supply

Spot premiums for Middle East crude grades Oman and Dubai have soared to ​all-time highs even as trade slumps due to the US and Israeli war on Iran, with some ‌traders arguing that the benchmarks have lost relevance due to supply disruption.

The surge in the benchmarks, used to price millions of barrels of Middle Eastern crude bound for Asia, is pushing up costs for Asian refiners, forcing them to seek alternatives or reduce output further in coming months.

Cash Dubai’s premium to swaps jumped ​to $56 a barrel on Monday, compared with an average of 90 cents in February, data from S&P Global Platts and Reuters showed. ​The premium accounts for about a third of the grade’s value, assessed at $153 a barrel by Platts ⁠for May-loading cargoes, versus $111.76 for Murban futures.

Dubai prices are distorted, given its wide price gap with Murban, three trade sources said.

Similarly, ​the premium for Oman crude futures to Dubai swaps hit a record near $51 a barrel on Friday, far above February’s 75 cents average.

Middle ​East crude exports to Asia fell to 11.665m barrels per day (bpd) in March, down from nearly 19m bpd in February and about 32 per cent lower than March 2025 levels, as the war halts shipping through the Strait of Hormuz, data from analytics firm Kpler showed.

Several Asian refiners have reduced operating rates.

Reduced supply

Some ​refining sources blamed the price spike on reduced supply available for delivery during the Platts Market on Close process, after the agency dropped three ​crude grades that transit via the strait.

“It is unnatural and unfair pricing because of thin trading,” one of the sources said, adding that the ‌remaining grades — ⁠Oman and Murban — are not representative of the benchmark used to price Middle Eastern and also some Russian barrels.

Another refining source said May-loading Middle East crude trade has stalled as the Dubai and Oman benchmarks are broken. The sources declined to be named as they spoke on the condition of anonymity.

“Platts Dubai continues to reflect the value of Middle Eastern sour crude trading in the spot ​market,” an S&P Global Energy spokesperson ​said in an email, adding ⁠that activity during the Platts MOC has been robust this month, with multiple cargoes delivered.

However, traders said TotalEnergies has been the only buyer receiving cargoes in the Platts window. The French major snapped up ​24 Oman and Murban crude cargoes, or 12m barrels, this month, trade data showed. TotalEnergies ​did not immediately ⁠respond to a request for comment.

Platts said on Monday it is seeking immediate feedback on the deliverability of Middle East crude and Platts Dubai crude benchmark methodology.

Africa, Americas for alternative supply

Meanwhile, spot premiums for crude from the Americas and Africa have risen as Asian refiners scramble for ⁠supply.

Two traders ​said premiums for Brazilian spot crude hit records of $12-$15 a barrel to ICE ​Brent, while premiums for April-loading West African crude on free-on-board basis rose about $1 a barrel from a month ago, with most cargoes sold, one of them said.