The shift comes after Dubai crude spiked to a record $169.75 per barrel earlier this month, briefly surpassing Brent and making Middle Eastern oil the most expensive globally. The sharp increase has been attributed to tightening supply and disruptions linked to geopolitical tensions affecting shipments through the Strait of Hormuz.
Market participants say the transition, though still in its early stages, could have broader implications. A decline in trading activity tied to the Dubai benchmark may reduce liquidity in its derivatives market, as traders increasingly hedge using Brent-linked instruments instead.
Asian buyers have only recently begun securing U.S. crude cargoes for July delivery under the new pricing approach. Among the deals, Taiyo Oil reportedly purchased 2 million barrels of U.S. light crude at a premium of around $19 per barrel above Brent. The company, which traditionally prices U.S. crude against Dubai benchmarks, declined to comment on the transaction.
Other Japanese refiners are also said to be following suit, opting for Brent-based pricing structures in privately negotiated deals, though specific details remain undisclosed.
The surge in Dubai prices has been exacerbated by changes in benchmark composition. S&P Global Platts recently excluded three of the five crude grades used in its Dubai assessment, citing concerns over prolonged supply disruptions. This move has effectively reduced the volume of oil available for pricing, contributing to the spike.
Strong demand from major energy firms, including TotalEnergies, has also helped sustain elevated Dubai prices.
In response to the volatility, some Asian refiners have reportedly approached Saudi Aramco—the world’s largest oil exporter—requesting a shift in its official pricing benchmark from Dubai to Brent. Such a move, if adopted, could mark a significant shift in global oil pricing dynamics.
While Saudi Aramco has yet to comment, the evolving situation highlights how geopolitical risks and supply constraints are reshaping long-standing pricing mechanisms in the global energy market.