{"text":[[{"start":8.23,"text":"TotalEnergies dominated the Middle East’s physical oil market in March, taking advantage of the wartime disruption to make a bumper profit."}],[{"start":18.47,"text":"One person close to the French group said its traders had made more than $1bn after buying up every cargo of crude oil produced in the United Arab Emirates and Oman to load in May that was available to buy in March. That amounted to 70 cargoes, more than double its purchases in February."}],[{"start":42.16,"text":"“Potentially, this is the biggest position-taking ever made in the history of oil markets,” said Adi Imsirovic, a lecturer in energy systems at the University of Oxford."}],[{"start":53.76,"text":"Before the US and Israel attacked Iran on February 28, TotalEnergies was already one of the biggest traders of Platts Dubai crude partials contracts, the main benchmark for Middle Eastern oil exports to Asia."}],[{"start":71.75999999999999,"text":"Iran responded to the attacks by choking traffic through the Strait of Hormuz, a narrow waterway at the entrance to the Gulf where ships carrying about a fifth of the world’s supply of oil usually pass."}],[{"start":85.10999999999999,"text":"This posed a dilemma for pricing agency Platts, which runs the Dubai contract, as three of the five grades it uses to price were trapped in the Gulf. On March 2, it said all of the crudes that were shipped through the Strait of Hormuz would be excluded from its assessment, effective immediately."}],[{"start":106.08999999999999,"text":"Demand surged for Abu Dhabi’s Murban and Oman, both sour grades of oil shipped from ports on the Gulf of Oman, pushing prices higher. TotalEnergies doubled down on its purchases. "}],[{"start":119.22999999999999,"text":"Fewer contracts increased the volatility of the benchmark and made it possible for a single entity to dominate the market. “Suddenly a lot less oil was trading and this makes any contract much more vulnerable to any one player taking a long position,” said Imsirovic. "}],[{"start":139.97,"text":"The price of Dubai oil climbed over the course of the month — from about $70 a barrel just before the war to an all-time high of about $170 last week — as TotalEnergies continued to buy more Dubai crude. By contrast the international oil benchmark Brent crude peaked at about $120 a barrel. "}],[{"start":164.92,"text":"While trading was about 50 per cent more active in March than the previous month, only TotalEnergies secured enough “partial” contracts to make a whole cargo."}],[{"start":175.81,"text":"“This month there’s been an unusually large amount of activity,” said Fabian Ng, head of Asia crude pricing at price reporting agency Argus Media. “Not only is the volume higher than usual but on the buy side, it has been completely dominated by just one player.”"}],[{"start":195.25,"text":"TotalEnergies was able to make its enormous profit by using so-called “paper oil” instruments, such as futures, options and swaps, to hedge its exposure to physical oil and bet on prices rising."}],[{"start":210.19,"text":"While it is easy to see who bought and sold contracts for physical oil, the paper oil market is more opaque. “By company policy, we never make any comments on our trading activities,” said a TotalEnergies representative. "}],[{"start":227.32999999999998,"text":"“I am guessing that Total was probably very lucky to be long paper as the war happened and Hormuz got closed,” said Imsirovic. “With the premiums they were paying [for Dubai oil], under the assumption they are much longer on paper than physical, this is probably the biggest position by any one player in oil markets in history, in terms of financial gain.”"}],[{"start":252.07,"text":"Meanwhile, the higher prices have hurt those buying oil on long-term contracts pegged to benchmarks such as Platts Dubai. Some Asian buyers have lobbied Saudi Aramco unsuccessfully to switch to pricing off ICE Brent crude futures, according to a note by Argus. "}],[{"start":271.4,"text":"Saudi Aramco declined to comment."}],[{"start":284.02,"text":""}]],"url":"https://audio.ftcn.net.cn/album/a_1774879140_4316.mp3"}