MUSCAT: Oman crude has surged far more sharply than Brent this week as disruption in and around the Strait of Hormuz reshaped regional oil pricing, lifted freight and insurance costs; and pushed buyers to pay a premium for barrels seen as more accessible to open-water markets.
The move has drawn fresh attention after Azza al Habsi, an economist at Ominvest, said in a LinkedIn post that Oman crude jumped from about $68 to $100 in one week, compared with a rise in Brent from roughly $72 to $87. Her argument is that Oman’s sharper climb reflects not only the wider geopolitical risk premium, but also distortions specific to Gulf crude flows and benchmark pricing.
Official data show the Oman marker has indeed risen steeply in recent days. The official price of Oman crude for May delivery settled at $82.09 a barrel on March 3, climbed to $85.93 on March 4 and then jumped to $94.47, according to figures published by Oman News Agency.
Analysts say the first driver is physical disruption to shipping through Hormuz, one of the world’s most critical energy chokepoints. Reuters reported that tanker traffic through the strait has collapsed, while S&P Global said no tankers crossed Hormuz on March 5. Freight rates for Persian Gulf crude cargoes to China also climbed sharply as shipowners, traders and insurers reassessed the risks of sailing through the area.
A second factor is the way regional crude benchmarks are being assessed during the disruption. Al Habsi noted that S&P Global Commodity Insights temporarily excluded grades that must transit Hormuz from part of its pricing process, a shift that effectively leaves fewer grades, including Oman, carrying more weight in price formation. That has amplified Oman crude’s response relative to broader global benchmarks such as Brent.
The squeeze is being reinforced by limited bypass capacity. S&P Global estimates that around 15 million barrels per day of crude and another 5 million bpd of oil products moved through Hormuz in 2025. While Saudi Arabia and the UAE have alternative pipeline routes, current infrastructure cannot fully offset a prolonged disruption, tightening supply perceptions across Asia. Reuters separately reported that Saudi Aramco has boosted Red Sea shipments, but that rerouting still falls well short of replacing normal Hormuz volumes.
That matters especially for Asian refiners, many of which are configured for Middle Eastern grades and cannot easily switch feedstock without higher cost or operational adjustments. Reuters reported this week that refiners across Asia are struggling to replace Gulf crude, even as some seek alternatives from the United States and elsewhere.
Market watchers say the result is an emerging premium on barrels that are either more readily deliverable or more influential in benchmark calculations. For Oman, this has translated into outsized gains compared with Brent, even as the broader oil complex rallies on fears of deeper supply disruption. Barclays said this week Brent could test $120 a barrel if tensions persist, underlining the scale of the market’s concern.
Still, economists caution against reading the price spike as a net positive for producers. Al Habsi said any short-term revenue gains are overshadowed by the wider damage caused by conflict, including higher inflation, increased transport costs, supply-chain disruption and greater volatility in financial markets. In that sense, the surge in Oman crude is less a windfall than a warning signal from a market under severe geopolitical stress.
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