Middle East crude oil premiums surge back to the $100 mark, Saudi Arabia's sharp reduction in exports to China sounds an energy alarm for Asia

⑴ On Monday, spot premiums for Middle Eastern crude oil benchmarks rose across the board. The spot premium of Dubai crude over swaps soared by $2.40 to $14.50 per barrel. Oman crude oil futures surged to $105.83 per barrel, a jump of over $5 compared to the previous trading day's $100.19. ⑵ As oil prices climbed back above $100 per barrel, navigation through the Strait of Hormuz has been effectively disrupted. Although three fully loaded supertankers passed through the strait on Saturday, Monday shipping data showed that all tankers have since avoided these waters, awaiting the implementation of the U.S. blockade order. ⑶ Saudi crude oil sales to China will plummet to a historic low in May. According to informed sources, Saudi Aramco plans to ship around 20 million barrels to Chinese customers in May, equivalent to fewer than 650,000 barrels per day, less than half of the January-February monthly average of 45 million barrels. ⑷ Spot trades in Singapore remain active. Unipec has sold multiple batches of Dubai crude intensively to Trafigura, Total, and Vitol, with transaction prices mostly ranging between $106.41 and $106.60 per barrel. The liquidity premium for Middle Eastern benchmark crude continues to expand. ⑸ The Caspian Pipeline Consortium's oil exports in March surged 48% year-on-year, mainly due to the recovery of production at the Tengiz oilfield. However, the incremental supply from Kazakhstan and Russia is far from enough to fill the supply gap in the Persian Gulf. Asian buyers have been forced to turn to the American LPG market to snap up alternative supplies, pushing regional premiums to record highs.