Trader: Asian refining companies are facing huge losses due to war-related disruptions in hedging strategies.

According to traders, the Middle East war has caused Dubai benchmark oil prices to soar, rendering ineffective the hedging strategies of Asian oil refineries and leading them to face huge losses. The interruption of Persian Gulf oil supply has led to a significant increase in prices of various oil products in the region, thereby affecting Dubai benchmark oil prices. Traders said that refineries typically take short positions on related derivatives before purchasing crude oil, as a typical raw material cost management measure. Sumit Ritolia, chief research analyst of the refinery and modeling department at analysis company Kpler Limited, said, "As long as crude oil shipments arrive on time, transportation routes are maintained, product supply is secure, and can be put on the market for sale, the hedging structure can work. However, the current supply disruptions have disrupted this correlation. What was intended to reduce risk has now become the source of financial pressure."