Asian Refiners Turn to Argentina as Iran War Disrupts Oil Supply
Asian crude oil importers, including China, Japan, and South Korea, have turned to buying oil from as far as Argentina to offset supply losses from the Middle East, anonymous traders with knowledge of the purchases told Bloomberg on Monday. Refiners in Asia, which have relied on the Middle East for a large part of their term supplies before the Iran war, are now scouring the global crude oil…
Asian refineries are increasingly sourcing oil from Argentina due to the ongoing Iran war disrupting Middle Eastern oil supplies, according to anonymous traders. China, Japan, and South Korea, among others, have turned to importing oil from Argentina to compensate for their reduced Middle Eastern oil imports.
Traditionally, Asian refineries relied heavily on the Middle East for their oil supplies, but now they are looking for alternative sources that don't have to go through the Strait of Hormuz or other politically unstable areas. Argentina is a potential alternative, and some Asian refineries have already purchased cargoes of its oil.
One such oil is Medanito crude, which is produced in Argentina's Vaca Muerta shale basin and is gaining popularity in Asia due to its comparable quality to U.S. West Texas Intermediate (WTI) oil.
Since 2024, Argentina's oil exports to Asia have been on the rise, while it had no exports until 2024. The South American producer's oil is traveling through a chokepoint-free route, which has attracted Asian refiners looking for alternative oil sources. Other South American producers like Brazil and Venezuela have also gained popularity among Asian refiners as they want to minimize their dependence on Middle Eastern oil. Medanito is being sold at a $1-$2 discount per barrel compared to WTI.
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