1. Three-layer pricing framework

1. Official Selling Price (OSP): For September Asia deliveries, SOMO set Basrah Medium at Oman/Dubai average −$4.00/bbl (vs −$6.50 in August) and Basrah Heavy at −$7.30/bbl (vs −$8.80), narrowing the official discount by $2.50 and $1.50 respectively as the seller lifts term levels amid tightening supply.

2. Spot dark discount (term rebate): On top of OSP, term buyers still receive an additional rebate of roughly $25–29.80/bbl for Medium and $27.80–29.80/bbl for Heavy (August basis; latest pending). This reflects physical de-stocking discounts under the war-risk premium.

3. Loading premium + 30% mechanism: SOMO's September spot tender (FOB Basrah Oil Terminal, STS transfer) prices by loading window — ≥$0.20/bbl for Sept 1–10 and ≥$3.00/bbl for Sept 11–30, with a 30% escalator clause that raises the premium for later loading.

2. Net-to-hand differential (Medium example)

Net-to-hand ≈ Oman/Dubai average − OSP discount(−$4.00) − spot rebate($25–29.80) + loading premium($0.20–3.00). At an Oman/Dubai average near $100/bbl, Medium net-to-hand lands around $66–71/bbl, with Heavy lower. Note the rebate is a term basis; spot-tender net is offset by the loading premium.

3. Practical notes

Hormuz transit has fallen to ~10 vessels/day (lowest since May); no VLCC has exited since Sept 2, with 27 vessel-strike incidents since July 6. Bab Al Mandab has also escalated after Houthi forces seized Mokha port. Chinese refiners (Rongsheng, Shenghong, CNPC, Hengli) sourcing Medium as feedstock must price war-risk insurance and rerouting freight into delivered cost. Sources: SOMO/Reuters, chemicalsupdates (Argus-equivalent), Kpler, Jin10/Huitong.