Contango

JUST IN: 🇸🇦 Saudi Arabia's East-West oil pipeline bypassing the Strait of Hormuz is now pumping at full capacity of 7 million barrels per day.

US Ambassador: “Put a pipeline down to the border… if Alberta wanted us to build a pipeline to the west coast, because they said we’ve got another 2M barrels of oil per day that we want to ship to Asia and Japan, I would think that we’d be very open to having that discussion”.

In 1995, a nurse broke hospital rules to place a newborn into her twin sister’s incubator. The baby was not expected to survive. Kyrie and Brielle Jackson were born 12 weeks early at a hospital in the United States. Each weighed roughly two pounds. They were placed in separate incubators, standard practice to prevent infection. Kyrie gained strength. Brielle did not. Three weeks after birth, Brielle went into critical condition. Her oxygen dropped. Her heart rate spiked. Her skin turned bluish-grey. Nurse Gayle Kasparian tried everything. She held her. She had her father hold her. She wrapped her in a blanket. Nothing worked. Kasparian remembered hearing about a practice used in parts of Europe but never tried in American hospitals. She placed Brielle into Kyrie’s incubator. Their father described what happened next: “She snuggled up to Kyrie and she was just fine. It was immediate. It was absolutely immediate.” Within minutes, Brielle’s oxygen levels were the best they had been since she was born. As she slept, Kyrie stretched her left arm across her sister’s body and held her. Photographer Chris Christo captured the moment. The image spread around the world and became known as “The Rescuing Hug.” Hospitals across multiple countries began placing premature twins together, a practice that had been resisted for decades. Both girls went home healthy. They are now 30.

ALERT: Rep. Mike Collins was spotted in the TSA security line without security.

Now John will say you can't hedge that way. You absolutely can. The reason Asian refiners were hedging against Dubai in the first place was convention. Their crude slate was predominantly Middle East, their product pricing was Dubai referenced, and keeping everything in the same benchmark universe simplified the book. But as more WTI Midland enters the Asian crude diet, hedging against the Brent benchmark that actually contains that grade is a tighter correlation, not a looser one. Not to mention the fact that S&P Global Platts, on March 2nd suspended nominations for any crude grade that requires transit through the Strait of Hormuz. That killed three of the five grades immediately. Dubai, Upper Zakum, and Al Shaheen all load from inside the Strait and can't get out. Only Oman (loads outside the Strait) and Murban remain deliverable.

If you've been watching oil prices and wondering why Dubai crude is falling while Brent keeps climbing...here's what's actually driving it. Asian refiners are switching their hedges on crude purchases from Dubai to ICE Brent. For decades, Asian buyers hedged against Dubai crude because most of their oil came from the Middle East and Dubai was the regional pricing benchmark. But Dubai just spiked to an all-time high of $169.75/bbl, way above Brent at ~$105. S&P Platts pulled 3 of 5 crude grades from the Dubai benchmark because of Hormuz disruptions, which distorted the price upward. If you're a refiner, why hedge against a $170 benchmark when you can hedge against a $105 one? Same protection, lower cost. ICE Brent is the global benchmark, originating as a North Sea European contract. It now includes US crude (WTI Midland was added to the basket as America became a major exporter), which makes it a natural alternative when Dubai pricing becomes distorted. The hedge migration creates a two way price effect. Money leaving Dubai drains liquidity and pushes the price down. That same money flowing into Brent adds liquidity and bids the price up. This is why the DME Oman contract has been declining while Brent stays firm. Same money, different direction. Some Asian refiners are now asking Saudi Aramco to switch its entire pricing formula from Dubai to Brent. If Aramco moves, the whole structure of how Middle East crude is sold to Asia changes.

If you've been watching oil prices and wondering why Dubai crude is falling while Brent keeps climbing...here's what's actually driving it. Asian refiners are switching their hedges on crude purchases from Dubai to ICE Brent. For decades, Asian buyers hedged against Dubai crude because most of their oil came from the Middle East and Dubai was the regional pricing benchmark. But Dubai just spiked to an all-time high of $169.75/bbl, way above Brent at ~$105. S&P Platts pulled 3 of 5 crude grades from the Dubai benchmark because of Hormuz disruptions, which distorted the price upward. If you're a refiner, why hedge against a $170 benchmark when you can hedge against a $105 one? Same protection, lower cost. ICE Brent is the global benchmark, originating as a North Sea European contract. It now includes US crude (WTI Midland was added to the basket as America became a major exporter), which makes it a natural alternative when Dubai pricing becomes distorted. The hedge migration creates a two way price effect. Money leaving Dubai drains liquidity and pushes the price down. That same money flowing into Brent adds liquidity and bids the price up. This is why the DME Oman contract has been declining while Brent stays firm. Same money, different direction. Some Asian refiners are now asking Saudi Aramco to switch its entire pricing formula from Dubai to Brent. If Aramco moves, the whole structure of how Middle East crude is sold to Asia changes.

>hormuz shut for a month now >ukraine blows up 40% of russia's oil export capacity >wti $90 i don't get it.