Oil Prices Rise on Middle East Supply Concerns, Bakken Differential Holds

Oil prices advanced in Wednesday morning trading, supported by tightening physical crude supplies from the Middle East. West Texas Intermediate (WTI) crude rose 84 cents, or 0.84%, to $84.77 per barrel, while the global benchmark Brent crude gained 68 cents, or 0.75%, to $91.70.

The price strength follows reports that the United Arab Emirates' national oil company, ADNOC, is curbing immediate crude shipments to Asia. According to a report from OilPrice.com, ADNOC plans to cut supply in spot tenders to Asian buyers by about 5% this month and next. The reduction is linked to maintenance on some of ADNOC's onshore fields in Abu Dhabi.

The supply curbs have lifted the price of Murban Crude, the UAE's flagship grade, to a four-month high. Murban this week traded at a nearly $7 per barrel premium over Brent, at $97.75 a barrel, OilPrice.com reported. The UAE left the OPEC producer group on May 1 and has since been pushing increased crude volumes to international markets, selling an estimated more than 100 million barrels in spot tenders since June.

For Bakken producers, the strength in global benchmarks is a positive signal, though local pricing reflects regional dynamics. Bakken crude at the wellhead traded at a differential of -$3.42 per barrel versus WTI, according to live price data. This means Bakken crude is priced at approximately $81.35 per barrel, factoring in the WTI price and the discount.

In other energy markets, natural gas prices also saw gains, rising 5 cents to $2.82 per MMBtu.

The supply situation in the Middle East remains a key driver for global oil markets. The UAE has managed to maintain export levels despite regional tensions, utilizing workarounds like maximizing its onshore pipeline and shipping tankers in "dark mode" to bypass the strategic Strait of Hormuz chokepoint, according to the OilPrice.com report.

For operators in the Williston Basin, sustained oil prices above $80 per barrel provide a stable economic environment for continued drilling and completion activity. The current differential is within a typical historical range for Bakken crude, which often trades at a discount to WTI due to transportation costs to major refining hubs.