COMMODITYSCOPE | DAILY MARKET BRIEF — OCT 13, 2026
Freight is still setting the price of physical oil.
Middle East crude differentials weakened, Atlantic barrels remain under pressure, and tanker economics continue to distort normal trade flows.
CRUDE
Middle East sour differentials slipped to two-month lows as new producer offers met weak spot demand.
• Dated Brent: $130.52/b ↓$3.73
• Dubai Dec: $108.75/b ↓$0.95
• Kuwait Export Crude Nov OSP: −$6.75/b vs Oman/Dubai
• KPC cut Asia OSPs by roughly $4/b
QatarEnergy also returned with spot offers for Al-Shaheen, Qatar Marine and Qatar Land.
The core issue remains freight.
PG → China VLCC:
WS1210
Inside Persian Gulf indications:
WS1200–1325
Gulf of Oman:
WS810–890
That spread continues to penalize barrels loading inside Hormuz.
DIRTY FREIGHT
🚢 Gulf of Oman → Far East VLCC: $163.68/mt
🚢 Black Sea → Med Suezmax: WS1070
🚢 WAF → East VLCC: WS755
🚢 USGC → UKC Aframax: $199.60/mt
The Platts VLCC index stands at approximately:
$1.169 million/day
That is +462% since the start of the Middle East war.
J.P. Morgan estimates:
• MEG → China VLCC freight: ~$35/bbl
• USGC → China: ~$41/bbl
Versus roughly $3/bbl and $6/bbl respectively earlier in 2026.
CLEAN FREIGHT
East-of-Suez LR markets remain extremely firm.
🚢 PG → Japan LR1: WS980
🚢 PG → Japan LR2: WS1015
🚢 USGC → UKC MR: WS375 ↑90
🚢 Cross-Med MR: WS390 ↑30
Charterers are increasingly using shuttle structures:
Persian Gulf → Oman / WCI → STS transfer
The reason is simple — direct Hormuz exposure has become too expensive.
Several LR2s are also considering switching into dirty service, further tightening clean tonnage.
REFINED PRODUCTS
Europe strengthened again:
• ICE LSGO: $1,450.50/mt ↑$39.75
• 0.1% CIF NWE gasoil: $1,426.50/mt ↑$38.50
• Jet CIF NWE: $1,666/mt ↑$38.50
But inventories remain structurally tight:
• ARA middle distillates: 2.255m mt
• 20% below 5-year average
• 26% below levels at the start of the war
Rhine logistics remain constrained, with Kaub around 20 cm and expected to fall further.
ASIA PRODUCTS
Asian ULSD softened after Russia partially relaxed its diesel export restrictions.
• Singapore 380 CST Oct/Nov backwardation: $52.50/mt
• Hi-5 spread: $62.58/mt
China has resumed jet exports, but logistics remain the bottleneck.
The market problem is no longer just cargo availability.
It is vessel availability.
UREA — SENTIMENT TURNING
Urea is starting to rebound.
Chinese producers rejected the implied Indian tender netbacks of $320–325/t FOB.
Current indications:
• China prilled FOB: $340–350/t
• Egypt granular FOB: $480/t
• Middle East FOB: $435–445/t
• Brazil CFR: $465–475/t
IPL counterbids remain:
• East Coast: $352.10/t CFR
• West Coast: $356.25/t CFR
Producer resistance is now clearly visible.
MARKET SIGNAL
🔺 Tanker freight remains the dominant physical-market variable
🔺 Inside-Hormuz loading carries an extreme freight penalty
🔺 Clean LR freight remains historically high
🔺 European distillate prices recovered while inventories stay tight
🔺 Urea sentiment is turning higher as Chinese producers resist low netbacks
🔻 Middle East crude differentials continue to weaken under freight pressure
Physical markets. Freight. Forward curves. Spreads. Daily intelligence.
🌐 commodityscope.com
#Oil #CrudeOil #Freight #Tankers #VLCC #Diesel #Shipping #Hormuz #Urea #Commodities
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