World's Biggest Oil Market Is Too Tied To Mideast To End Addiction -- March 31, 2016

Bloomberg is reporting:

Mideast:

• producers have cut official selling prices; defend against other suppliers taking their markets
• Saudi Arabia is selling Arab Light in Asia for 75 cents below benchmark Middle East prices (compare with $2.75 premium in early 2014)
• Iran offering its oil at a deeper discount than Saudi Arabia for first time in a decade 
• strategy working; but IEA has warned there is an increased possibility of oil-security surprises in the "not-too-distant" future
• with non-OPEC supplies falling, Asian refiners have no choice but to buy Middle Eastern oil: cheaper and available in large volumes

Asia likes Mideast oil:

• shorter shipping times
• attractive prices
• type of crude oil the refineries were optimized for

South Korea:

• imports from the Middle East climbed last year to the highest level since at least 1980
• wants to diversity purchases to guard against geopolitical risks tied to some of the world's biggest suppliers 
• imported 845 million bbls in 2015; high since 1980 when that country started compiling the data

India:

• refiners are shunning shipments from distant ports, taking more cargoes from Persian Gulf
• wants to diversity purchases to guard against geopolitical risks tied to some of the world's biggest suppliers
• but, India's Reliance Industries, owner of the worlds biggest refining complex is shifting from crudes tied to Brent to grades priced against Dubai, the Middle East marker

China:

• Saudi Arabia and Oman have boosted supplies to China this year as volumes from Venezuela and Colombia have shrunk
• more than half of the top 10 suppliers were from the Middle East last year