Forties crude in the physical Brent market rose above $135 a barrel, while the spread between Brent futures contracts six months apart exceeded $20 as Saudi Arabia’s East-West pipeline shutdown and tanker attacks disrupting exports through the Strait of Hormuz fueled expectations of crude shortages. Dated Brent, the physical spot benchmark, closed above $130 on Monday.

China’s crude futures reached 929.4 yuan, or $138.50 a barrel, on the Shanghai International Energy Exchange, the highest since the contract began trading in 2018. Chinese refiners were buying more cargoes and seeking supplies for October delivery. Russian Urals crude for delivery to Indian ports commanded an $8 premium over Dated Brent, the highest since May, as reduced Gulf supplies left refineries short of crude, Reuters reported, citing three sources.

Saudi Arabia has told some European refiners that their crude cargoes scheduled to load in September are canceled following the pipeline closure, Reuters reported. The route carries oil to Yanbu on the Red Sea, bypassing Hormuz. Kpler estimates the damage could reduce Yanbu exports by 2.5 million to 2.7 million BPD for up to six weeks. Saudi Arabia can redirect roughly 3 million BPD through Ras Tanura, but doing so increases its reliance on Hormuz.