Latest News

ADNOC will switch the oil price benchmark from Murban to Platts-Dubai.

ADNOC will switch the oil price benchmark from Murban to Platts-Dubai.
ADNOC will switch the oil price benchmark from Murban to Platts-Dubai.

Abu Dhabi National 'Oil 'Co announced on Friday that it will switch the benchmark for its monthly official selling price for all of its crude grades from Murban crude prices to Platts Dubai pricing for immediate-month from November 1.

ADNOC said that the change will apply to Abu Dhabi crude grades onshore and off-shore, including Murban Das Umm Lulu Upper?Zakum and Murban. The company stated in a?statement?that it would align ADNOC OSPs with the month of cargo loading. ADNOC will announce the differentials between Dubai and ADNOC quotes in the month prior to cargo loading.

ADNOC stated that the new pricing mechanism "reinforces ADNOC’s commitment to transparency in pricing for its growing customer base and investor base."

The company said it would continue to?meet all its obligations in regard to the delivery of crude grades from Abu?Dhabi, both onshore and off-shore.

The move comes after the U.S. and Israeli war against Iran disrupted oil imports from the Middle East via the Strait of Hormuz, causing significant hedging losses for traders who deal in Abu Dhabi oil. Since June, the producer has been consulting with customers on proposed changes to its OSPs.

ADNOC also sells its crude cargoes through?spot bids' since June, at differentials from Dubai quotes. SUDDEN CHANGE SAYS A TRADER

A crude trader told the media on Friday that this announcement was a sudden one.

ADNOC stated that the change in pricing mechanism will not have an impact on any ADNOC listed instruments, such as issuances completed under ADNOC Murban’s GMTN and Sukuk programs.

ICE Futures Abu Dhabi (IFAD) has announced that it will continue trading in Murban crude contract months with open interest, while those without will be stopped from Friday. A spokesperson for ICE did not respond immediately to a query about what would happen next.

IFAD was established to 'turn ADNOC Murban crude into a global benchmark, and give Middle East producers a transparent exchange-based pricing system. ICE is also home to the global Brent contract. (Reporting and editing by Louise Heavensn, Kirby Donovan, Kirby Donovan, and Ahmad Ghaddar)

(source: Reuters)