Brent Surges Toward $95 as Diesel Prices Reach Record High
Record diesel prices and refining cracks are driving up oil costs, pushing Brent toward $95 per barrel. The US national average price of diesel has hit an all-time high, with middle distillate cracks now exceeding outright crude prices. OPEC+ is likely to freeze quotas for October at 31.01 million b/d due to the ongoing US-Iran war and supply increases from Middle Eastern producers being capped.
The Saudi national oil firm Saudi Aramco kept its October selling price to Asia at a $2 per barrel discount to Oman/Dubai, defying expectations of an increase. This move is seen as a response to the low refining margins in the region. In other news, Bangladesh paid nearly $100 million for one LNG cargo from BP at $28.03/MMBtu, the highest price recorded since 2022.
US diesel prices are expected to remain high due to Hormuz product flows dissipating and Russia's export ban continuing. The US Interior Department proposed allowing companies to access 5,200 acres of federal lands in Utah's oil-rich Uinta basin for drilling. Europe's gas price has hit a three-year high, with the benchmark futures TTF soaring past €72 per MWh.