Asia buys most US oil in three years as war blocks Middle East flows
The US is among the beneficiaries of the recent upsurge in demand and jump in prices
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[SINGAPORE] Asian buyers have scooped up the most US oil in three years this month as they hunt for alternatives to Persian Gulf crude trapped behind the Strait of Hormuz.
A flurry of purchases in recent days has taken the amount of Asia-bound American oil to be loaded in April to about 60 million barrels, according to traders familiar with the deals, who asked not to be named as they are not allowed to speak publicly.
That is the most for a single month since April 2023, data from Kpler and Vortexa shows.
The de facto closure of Hormuz has hit Asian nations that are heavily reliant on oil from the Gulf particularly hard, spurring refinery run cuts, a ban on fuel exports in China and the appointment of a new fuel czar in Australia.
The US, the world’s biggest oil producer, is among the beneficiaries of the resulting upsurge in demand and jump in prices.
One of the shipments, to Taiwan, was priced at a US$12 to US$13 a barrel premium to the Dated Brent benchmark, the traders said. Other cargoes were pegged about US$18 a barrel above the Dubai marker, although the big swings in benchmarks this week have complicated the pricing process, they added.
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That compares with US$5 to US$6 barrel premiums over Dubai in similar deals done last month, before the war.
The oil will not provide Asia with a quick fix to the current crisis, however. Shipments loaded in the US in April typically will not reach their destinations until about two months after that.
The buyers include a broad swathe of refiners in Japan, South Korea, Taiwan, Singapore and Thailand, the traders said. The 60 million figure could go higher still, as the window to purchase April-loading cargoes from the US remains open for a short while longer.
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The US usually exports around 110 million barrels a month, with about half going to Europe and more than a third heading to Asia, according to Kpler and Vortexa. Asian buyers took around 35 million barrels of American oil in each of the first two months of this year. BLOOMBERG
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