Oil prices barely moved in early trade on Monday as tanker traffic through the Strait of Hormuz slowed over the weekend. Brent crude futures climbed 20 cents, or 0.2%, to $88.72 by 2350 GMT, while US West Texas Intermediate crude futures slipped 5 cents to $82.35 a barrel.
Both contracts gained more than 5% last week following attacks on tankers operated by Abu Dhabi National Oil Company in the Hormuz strait and on a Saudi Aramco refinery.
According to shipping data, five commodity vessels crossed the strait on Saturday and none on Sunday, compared with 31 the previous weekend.
Meanwhile, India has set a maximum daily cooking gas production target of 63,810 metric tons for state-run and private refineries to ensure domestic supplies and build buffers after U.S.-Israeli war against Iran disrupted supplies of the essential fuel, according to an August 13 government order.Here are more details from the order:
As per the order,
- Companies are required to maintain adequate infrastructure for storing and transporting liquefied petroleum gas (LPG), either directly or through railways and road tankers, to meet specified quantities.
- The federal government will update the targets every January and July to reflect new production and additional output from existing refineries.
- India was buying about 90% of its cooking gas imports from the Middle East before the war on Iran disrupted supplies from March due to the blockade of the Strait of Hormuz.
- India has set production targets for individual refiners with Reliance Industries Ltd’s (RELI.NS), opens new tab domestic-market-focused refinery tasked to produce 18,000 tons a day of LPG.
- State-run explorers Oil and Natural Gas Corp (ONGC.NS), opens new tab and Oil India Ltd (OILI.NS), opens new tab, and gas utility Gail India Ltd (GAIL.NS), opens new tab are expected to contribute 10% of the nationwide target.
Experts claim refined oil products were hit harder than the broader crude oil market by the West Asian conflict.They noted that diesel in particular had “emerged as the tightest segment of the petroleum complex,” with supplies battered by a mix of supply disruptions, refinery outages, and shipping constraints. According to their analysis refinery disruptions across the Persian Gulf had battered production and export of diesel, even as global demand for the fuel remained robust. They added that the situation was compounded by continued clashes between Russia and Ukraine, as Kyiv attacked more of Moscow’s oil infrastructure.