This watch is based on SOMO official selling prices (OSP) and publicly observed market developments, for trading and hedging decisions.

1. OSP marker: On 8 Oct SOMO set November Basrah Medium OSP to Asia at a discount to the Oman/Dubai average, and Heavy at a deeper discount, a sharp deepening from October's levels. Europe Medium was set at a discount to dated Brent, Americas at a premium to Sour. The cut follows Saudi lowering November Arab Light to Asia, signalling Middle East producers defending market share against transit risk concerns. STS has now spilled to India's west coast; Fujairah/Sohar hubs are congested.

For Basrah Medium: OSP + spot rebate ≈ FOB net discount to Oman/Dubai; adding current VLCC freight and war risk, delivered discount is deeper.

Heavy is more attractive due to its larger OSP and spot rebate discounts. Iraq, Saudi and Qatar are offering deep discounts to offset freight and security costs to retain Asian buyers. Hormuz and practical notes

On 17 Oct 13:52Z the IRGC confirmed a second VLCC carrying over 2 million barrels of crude struck a naval mine and caught fire in Hormuz on an 'unauthorized route' (AIS/radar off), releasing footage that raised market conviction in a politically driven mining threat. via Al Jazeera (17 Oct) indicates reduced throughput through the strait relative to pre-conflict levels; vessel transits remain significantly constrained, with tankers transiting in larger, more concentrated groups. London underwriters have repriced war risk premiums substantially above baseline; the Lloyd's JWC has extended its high-risk designation to the entire Persian Gulf. Brent touched 110.122 USD/bbl intraday for the first time since May and is +75% YTD, driven by Middle East escalation plus disrupted Russian supply (Russian diesel excluded, Ryazan refinery hit). (2) War risk and freight stay extreme; term contracts and STS Fujairah / India-west-coast offshore delivery help spread single-voyage risk. (3) Flows remain well below pre-war levels and full STS now exceeding one week — stagger procurement and keep alternative corridors open (ADCOP 1.5 mb/d, East-West Pipeline, Syria land route as backup).