Middle East crude benchmarks hit record highs, becoming the world’s most expensive oil, despite a drop in trade caused by the US and Israel’s war on Iran.

Some traders argue the benchmarks are losing relevance amid ongoing supply disruptions, according to Reuters.

The spike, which sets prices for millions of barrels of Middle Eastern crude heading to Asia, is raising costs for regional refiners, prompting them to look for alternatives or cut production in the coming months.

Cash Dubai crude surged to a record US$153.25 per barrel on March 16 for May-loading cargoes, S&P Global Platts reported, topping Brent’s 2008 high of US$147.50.

The spike raised Dubai’s premium over swaps to US$56.01 per barrel, about a third of the crude’s value, up sharply from February’s average of 90 cents, according to Reuters data.

Oman crude futures also hit an all-time US$147.79 per barrel, with their premium to Dubai swaps jumping to US$50.57 per barrel, far exceeding February’s 75-cent average.

Dubai crude prices appear distorted, traders say, due to the large gap with Murban futures, which settled at US$111.76 per barrel on March 16, according to three market sources.

Middle East crude exports to Asia dropped to 11.665 million barrels per day in March, down from nearly 19 million bpd in February and roughly 32 per cent lower than March 2025, as the war disrupts shipping through the Strait of Hormuz, according to analytics firm Kpler.

Some refining sources attributed the price surge to reduced supply available for delivery during the Platts Market on Close process, following the agency’s removal of three crude grades that transit the Strait of Hormuz.

“It is unnatural and unfair pricing because of thin trading,” one of the sources said, adding that the remaining grades, Oman and Murban, are not representative of the benchmark used to price Middle Eastern and also some Russian barrels.