It is unlikely that the bullish sentiment currently driving oil markets can be sustained over a prolonged period, but Middle Eastern producers are determined to make the most over higher prices while they last. On the back of ballistic missile attacks on Saudi infrastructure and OPEC+ quota roll-overs, the global benchmark Brent surpassed the key threshold of $70 per barrel for the first time in more than a year. Concurrently, backwardation steepened even further, with a solid $7 USD difference between April 2021-April 2022 contracts. Against such a background, Saudi Aramco and other Middle Eastern NOCs have opted for a conservative approach, increasing prices of lighter grades as gasoline cracks have been improving throughout February, all the while rolling over heavier streams into the next month. Graph 1. China’s Crude Imports in 2010-2021 (million barrels per day). Source: author’s data. One of the key factors in oil markets over […]