KEY POINTS
- Dubai crude premium drops more than 60% to about $17 per barrel
- Sellers flooded market while TotalEnergies remained sole buyer
- Volatility linked to U.S.-Israeli war with Iran and Hormuz disruptions
The spot premium for Dubai crude has dropped sharply to its lowest level in three weeks after sellers flooded the market with offers while TotalEnergies remained the only active buyer during the trading window, traders said.
The sudden imbalance between supply and demand pushed the premium for the Middle East benchmark down significantly, highlighting ongoing volatility in global oil markets.
At the close of trading in Singapore, the premium fell to about $17 per barrel, representing a drop of more than 60 percent from $51.20 per barrel in the previous session. The steep decline follows heightened geopolitical tensions linked to the ongoing U.S.-Israeli conflict with Iran, which has disrupted shipping through the Strait of Hormuz and triggered erratic pricing swings across Middle East crude markets.
Dubai crude serves as a key benchmark used to price millions of barrels of oil exported to Asia. Movements in its premium often reflect immediate supply-demand conditions in the region. Traders said the latest decline was driven by a surge in offers from multiple sellers, including major trading houses and oil companies, while buying interest remained limited.
Sellers dominate Platts trading window
Market participants noted that several sellers began offering Dubai crude about an hour before the S&P Global Platts Market-on-Close trading window officially opened. This early activity allowed them to steadily push prices lower before meaningful buying interest emerged.
Under Platts methodology, participants submit bids and offers throughout the session, and these transactions are used to determine benchmark pricing. The structure limits price movements to increments of five cents per barrel every five seconds, which traders say can make it difficult to counter aggressive early selling.
According to market sources, TotalEnergies’ trading arm was present in the market but did not aggressively bid against the wave of offers. As a result, sellers were able to maintain downward pressure throughout the session. Platts did not immediately comment on the developments.
Platts window since the beginning of the month. The company has purchased 69 cargoes of Oman and Murban crude, equivalent to about 34.5 million barrels.
The concentration of buying activity in a single participant has amplified price swings, especially when multiple sellers enter the market simultaneously. Traders said this dynamic contributed to the sharp drop in Dubai’s premium during the latest session.
