The United Arab Emirates’ biggest oil producer is exploring the idea of selling a new, heavier crude as the company revamps the way it trades barrels in order to maximize profits.
Abu Dhabi National Oil Co. could introduce the blend, which would likely come from several offshore depots, as early as late next year, according to people with knowledge of the situation. The new grade may be named Ghasha after one of the offshore fields and will be introduced once these developments ramp up production.
The company is gauging market demand for the new variant and trying to determine whether there is enough flow to justify it, said the people, who asked not to be identified discussing confidential deliberations. Adnoc declined to comment.
The creation of the new grade could help ensure the quality of Adnoc’s other offshore crude by removing the heavier barrels. It could also fill a niche market for crude that is not as light as the UAE’s other oil blends, the people said. The company may also decide not to move forward with the new rating, they said. In this case, it would be mixed with one of the existing grades.
The United Arab Emirates, the Organization of the Petroleum Exporting Countries’ third-largest producer, has used its oil wealth to build a commercial, leisure and transport hub in the region. Adnoc is spending billions to increase crude production capacity by about a quarter to 5 million barrels per day by 2027 as it expands its natural gas and chemicals industries and looks for ways to make those companies are less polluting.
Adnoc has allowed its flagship Murban crude to trade freely on an Abu Dhabi exchange from 2021 and wants the Upper Zakum grade to be bought and sold in the same way, Bloomberg reported. Murban, with a capacity of about 2 million barrels per day, comes from Abu Dhabi’s onshore fields, while Upper Zakum is produced from the offshore fields along with Das and Umm Lulu crudes, which are pumped in smaller quantities.
The company seeks to have the Murban trade as a benchmark, next to Brent.
