Total Buys 20% of Annual Crude Volume in March
French energy giant TotalEnergies cornered the Middle East crude market in March, executing a trading strategy of unprecedented scale. The company's trading division purchased 69 ships of Dubai benchmark crude through the Platts pricing window, an amount traders noted was unheard of and equivalent to nearly 20% of the entire market's expected trading volume for all of 2025. The aggressive buying occurred as a Middle East war severely limited market liquidity and choked off supplies through the Strait of Hormuz. This maneuver artificially inflated the Asian benchmark, pushing Dubai and Oman crude prices to a record high of over $170 per barrel. The move created an extreme dislocation with global benchmarks, which saw Brent crude trading near $120 and WTI around $100 at the same time. The premium for physical barrels over derivatives soared to an extraordinary $60, a level far exceeding the typical few dollars.
Oman Futures Plunge $48 as Total's Bid Disappears
The price bubble created by Total's buying spree burst the moment the company stepped away from the market. On a Wednesday in late March, Total briefly halted its bidding, triggering an immediate and catastrophic collapse. Oman crude futures plummeted by as much as $48 a barrel, while Murban crude futures fell by nearly $20. The reversal was intensified by news that crude transport through the Strait of Hormuz was gradually resuming, which emboldened more traders to take positions against Total's massive long. The sudden evaporation of the market's largest buyer left Total in a precarious position, holding enormous volumes of crude purchased at peak prices. The firm now faces the risk of huge paper losses and potential margin calls, which could force it to liquidate its positions and accelerate the price decline further.
Aggressive Trade Amplifies Asia's Supply Chain Crisis
Total's market gambit exacerbated an already severe energy crisis across Asia, inflicting pain on supply chains from Seoul to Mumbai. The price spike directly impacted the cost of naphtha, a petrochemical feedstock primarily sourced from the Persian Gulf and essential for manufacturing plastics. The disruption rippled through the industrial sector, with one South Korean plastics factory reporting it had been forced to slash production to just 20% of capacity due to suppliers raising prices by 50% or halting deliveries altogether. The crisis also reached consumers, sparking panic buying of goods like trash bags and instant noodles in South Korea and Japan. Market participants widely interpreted Total’s strategy as a deliberate attempt to squeeze a panicked, illiquid market for profit. However, as the trade unwound, it appears Total may be the one to pay the heaviest price for its high-stakes bet on continued conflict.
