SINGAPORE: Asian refiners are paying the highest premiums for Middle East and Russian crude oil in about a year, due to firm demand and more costly imports from the West, industry sources said.
High prices could prompt refiners to draw down inventories, tightening supply buffers even as the Organization of the Petroleum Exporting Countries (OPEC) and their allies including Russia gradually ease supply cuts.
Several popular grades in Asia, such as Oman, Russian ESPO and Sokol crude, are trading at the highest premiums in 11 months against Dubai quotes, according to trade sources and Refinitiv data.
The spread between first and third month cash Dubai prices is at its widest backwardation since pre-COVID levels in January 2020, Reuters data showed, indicating strong demand for prompt supplies.
Spot crude prices in Asia are a leading indicator for global markets as several of the world’s top importers are located in the region. Asian refiners also typically buy oil two months in advance, earlier than other regions. “Demand is rising and supply is falling short of expectations, leading to a strong market that is being reflected in physical markets now,” Energy Aspects analyst Virendra Chauhan said.
Major refineries in top importer China are processing more crude as domestic margins have improved after a government crackdown on some fuel imports, refining and trade sources said. Some independent refiners have also resumed crude purchases for July and August arrivals, anticipating a second batch of import quotas soon, they added.
Refineries in other parts of Asia are also cranking up after maintenance to meet demand during the peak summer season in the northern hemisphere, including during the Tokyo Olympics which start in July, they said.
However, importing crude oil from Europe, West Africa and the United States is currently uneconomical as Brent’s premium to Dubai has widened while spot premiums for grades such as Angola’s Cabinda and Kazakhstan’s CPC Blend have climbed, the sources said.
“Arbitrage from West Africa and Europe to Asia could decline and increase demand for regional barrels,” a North Asian refining source said, referring to oil from Asia Pacific, Russia, and Middle East.
While Asian refiners will buy crude to meet baseload demand, or the minimum amount of crude required for a refinery, they are likely to draw down inventories for incremental supplies, the industry sources said.
“If everybody only buys baseload crude, (prices in) the market may be toppish soon,” a second North Asian refining source said.
Energy Aspects expects a global crude stocks draw of 2.7 million barrels per day (bpd) in the third quarter, compared with 1.4 million bpd in the second quarter.
“OECD inventories are back at the 2015-2019 average so OPEC+ have achieved their aim,” Chauhan said.
“The only way to stop prices from rising is a rise in OPEC+ supply, but they are waiting for clarity on Iran before taking any action.”
Asian refiners pay highest premium for Mideast crude in a year
https://arab.news/mrcr8
Asian refiners pay highest premium for Mideast crude in a year
- Spot crude prices in Asia are a leading indicator for global markets as several of the world’s top importers are located in the region
New Murabba seeks contractors for Mukaab Towers fit-outs: MEED
RIYADH: Saudi Arabia’s New Murabba Development Co., a wholly owned subsidiary of the Public Investment Fund, has issued a request for information to gauge the market for modular and offsite fit-out solutions for its flagship Mukaab development, MEED reported on Wednesday.
The RFI was released on Jan. 26, with submissions due by Feb. 11. NMDC has also scheduled a market engagement meeting during the first week of February to discuss potential solutions with prospective contractors.
Sources close to the project told MEED that NMDC is “seeking experienced suppliers and contractors to advise on the feasibility, constraints, and execution strategy for using non-load-bearing modular systems for the four corner towers framing the Mukaab structure.” The feedback gathered from these discussions will be incorporated into later design and procurement decisions.
The four towers — two residential (North and South) and two mixed-use (East and West) — are integral to the Mukaab’s architectural layout. Each tower is expected to rise approximately 375 meters and span over 80 stories. Key modular elements under consideration include bathroom pods, kitchen pods, dressing room modules, panelized steel partition systems, and other offsite-manufactured fit-out solutions.
Early works on the Mukaab were completed last year, with NMDC preparing to award the estimated $1 billion contract for the main raft works. This was highlighted in a presentation by NMDC’s chief project delivery officer on Sept. 9, 2025, during the Future Projects Forum in Riyadh.
Earlier this month, US-based Parsons Corp. was awarded a contract by NMDC to provide design and construction technical support. Parsons will act as the lead design consultant for infrastructure, delivering services covering public buildings, infrastructure, landscaping, and the public realm at New Murabba. The firm will also support the development of the project’s downtown experience, which spans 14 million sq. meters of residential, workplace, and entertainment space.
The Parsons contract follows NMDC’s October 2025 agreements with three other US-based engineering firms for design work across the development. New York-headquartered Kohn Pedersen Fox was appointed to lead early design for the first residential community, while Aecom and Jacobs were selected as lead design consultants for the Mukaab district.
In August 2025, NMDC signed a memorandum of understanding with Falcons Creative Group, another US-based firm, to develop the creative vision and immersive experiences for the Mukaab project. Meanwhile, Beijing-based China Harbour Engineering Co. completed the excavation works for the Mukaab, and UAE-headquartered HSSG Foundation Contracting executed the foundation works.
