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Saudi Arabia Reportedly Increases Crude Sales Outside Hormuz After East-West Pipeline Shutdown

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Saudi Arabia is increasing sales of prompt crude from just outside the Strait of Hormuz after an attack on its East-West pipeline disrupted oil flows to the Red Sea coast, multiple media outlets reported Wednesday.

Asian refiners, including Chinese state-owned and independent processors and other East Asia importers, this week secured about 20 million barrels of crude from Saudi Aramco to be picked up in October at the latest from just outside the Hormuz strait, Bloomberg reported, citing traders.

The kingdom has also increased its offering of crude oil loading to Asian refiners via ship-to-ship transfer off Oman's Sohar port. Saudi Aramco made available the flagship Arab Light grade, Arab Medium and Arab Heavy to term buyers in Asia for loading off Sohar, which is just outside the Strait of Hormuz, according to a Reuters report, citing people familiar with the matter.

The offers suggest Aramco is moving more crude out of the Gulf for shipments outside the Strait of Hormuz. In recent weeks, Aramco has made at least two similar offers of Arab Medium and Arab Heavy crude to Asian buyers, the Reuters report said.

In the last seven days, Saudi Arabia's daily crude loadings at its Ras Tanura and Juaymah terminals inside the Gulf have doubled to two very large crude carriers or 4 million barrels. Meanwhile, 4 VLCCs with a carrying capacity of 8 million barrels were detected at the Ras Tanura terminal on Wednesday, Reuters reported, citing satellite and ship-tracking data from Energy Aspects and Kpler, respectively.

The East-West pipeline, which has been Saudi Arabia's main bypass since the closure of the Strait of Hormuz, was shut down last week after attacks, with no official timeline for a restart. Media reports have quoted officials and experts citing repairs lasting anywhere from a few days to six weeks.

Rising spot sales through the Persian Gulf suggest Riyadh is turning back to its traditional export route despite the shipping risks involved, the Bloomberg report said.

Meanwhile, Pakistan is exploring alternatives for an empty oil tanker stranded in the Red Sea near Saudi Arabia's East-West pipeline, which could remain shut for six weeks, " Bloomberg reported Wednesday, citing Pakistan's Energy Minister Ali Pervaiz Malik's interview with Express 24-7 news channel on Tuesday.

Saudi Aramco declined to comment to' request for comment.

What else is happening in Commodities?

Commodities

US Natural Gas Update: Futures Continue to Rise on Warmer Weather Forecasts

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Commodities

US Crude Oil Inventories Rise, API Says

Data from the American Petroleum Institute revealed Tuesday that US crude oil inventories increased by 7.14 million barrels in the week ended Sept. 11, following a 300,000-bbl draw the previous week, and compared with analysts' estimate of a 1.8-mmbbl decline, according to a Bloomberg-compiled survey.The oil market now awaits the US Energy Information Administration's petroleum inventory report, scheduled for release on Wednesday.

Commodities

US Power Update: Prices Mostly Higher Tuesday Afternoon, With Natural Gas Leading the Generation Mix

US wholesale electricity markets were mostly higher Tuesday afternoon, with intraday prices ranging from a high of $372.39 per megawatt-hour to a low of -$102.90/MWh, according to GridStatus.io.Electric Reliability Council of Texas' real-time locational marginal price was $36.99/MWh at 4 p.m. ET. Net load reached 41.59 gigawatts, while solar accounted for the largest share of the generation mix at 36.6%.California Independent System Operator's real-time LMP was $27.25/MWh at 4 p.m. ET. Net load was 0.66 GW, with solar making up the largest share of the generation mix at 66.2%.Southwest Power Pool's real-time LMP stood at $92.93/MWh at 4 p.m. ET. Net load reached 36.68 GW, while natural gas represented the largest share of the generation mix at 38%. Prices climbed to an intraday peak of $233.61/MWh at 4:25 p.m. ET.PJM's real-time LMP was $66.99/MWh at 4 p.m. ET. Net load totaled 97.39 GW, with gas providing the largest share of the generation mix at 42.8%. Prices rose to an intraday high of $264.54/MWh at 4:10 p.m. ET.Midcontinent Independent System Operator's real-time LMP was negative at -$69.78/MWh at 4 p.m. ET. Net load was 86.07 GW, while natural gas accounted for the largest share of the generation mix at 33.1%.Prices reached an intraday high of $372.39/MWh at 5:20 a.m. ET, before falling to an intraday low of negative $102.90/MWh at 2:50 p.m. ET.New York Independent System Operator's real-time LMP stood at $51.66/MWh at 4 p.m. ET. Net load reached 15.82 GW, with dual fuel making up the largest share of the generation mix at 29.6%. Prices advanced to an intraday high of $245.16/MWh at 2:25 p.m. ET.Independent System Operator New England's real-time LMP was $31.83/MWh at 4 p.m. ET. Net load came in at 9.98 GW, while natural gas supplied the largest share of the generation mix at 37.1%.Independent Electricity System Operator's real-time LMP reached $32.76/MWh at 4 p.m. ET. Net load was 15.15 GW at 3:55 p.m. ET, with nuclear accounting for the largest share of the generation mix at 43.1%.The National Weather Service's Climate Prediction Center forecasts above-normal temperatures across most of the US from Sept. 23-29, with below-normal readings in parts of the West.