FT: TotalEnergies cashes in on oil chaos

TotalEnergies dominated Middle Eastern crude trading in March, capitalising on wartime disruptions that restricted shipments through the Strait of Hormuz, the Financial Times reported. The company is estimated to have earned over $1 billion (€868 million) by acquiring large volumes of oil cargoes.

According to sources cited by the FT, TotalEnergies purchased about 70 crude cargoes from the United Arab Emirates and Oman for May loading—more than double its February volume. The company declined to comment publicly on its trading activity.

The opportunity emerged after S&P Global Platts suspended, on March 2, nominations of crude grades requiring transit through the Strait of Hormuz due to security risks. This removed three of the five benchmark grades used in the Dubai crude pricing system, cutting deliverable supply by about 40% and leaving mainly Abu Dhabi’s Murban and Oman crude in circulation.

With reduced liquidity, the market became vulnerable to dominance by a single trader. While overall trading activity rose by around 50% month-on-month, TotalEnergies was the only player able to accumulate enough partial contracts to form full cargoes.

Prices surged amid the disruption: Dubai crude jumped from around $70 per barrel before the conflict to about $170 at its peak, while Brent crude rose to around $120 in mid-March before easing to roughly $113.

Chief executive Patrick Pouyanné described refining margins as unprecedented and the oil products market as “dislocated.” He warned that if the conflict continues into summer, European gas prices could reach $40 per million British thermal units, up from about $18.

At the same time, the company said on March 13 that production disruptions in Qatar, Iraq, and offshore UAE affected about 15% of its global output. However, because Middle Eastern production contributes only about 10% of upstream cash flow, higher oil prices—specifically an $8 per barrel increase in Brent—fully offset these losses.

The surge in Dubai crude prices has also strained Asian refiners, some of whom have urged Saudi Aramco to shift pricing from Platts Dubai to ICE Brent. On March 20, Platts further adjusted the benchmark by suspending the negative quality adjustment for Murban crude to increase supply flexibility.

By Tamilla Hasanova