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Brent/Dubai EFS widens to over 2-month high

The spread between ICE Brent futures and Dubai crude futures widened to over a two-month high mid-morning Wednesday in Asia, as Brent rose on expectations of US stocks draw, while market participants continued to digest the latest Abu Dhabi’s official crude selling prices.

The Brent/Dubai Exchange of Futures for swaps was notionally pegged at $3.21/b, at 11 am in Singapore (0300 GMT) Wednesday. This was up 4 cents/b from the $3.17/b assessed at 4:30 pm in Singapore (0830 GMT) Tuesday.

The spreads have widened as the front-month ICE Brent November futures rose 22 cents/b from Tuesday’s settle to $58.48/b at 11 am in Singapore (0300 GMT) Wednesday.

Brent rose amid expectations of a drop in US crude inventories last week as refiners maintained high runs.

The Brent/Dubai EFS was last wider on June 18 when it was assessed at $3.29/b, S&P Global Platts data showed. A wider spread increases the competitiveness of Dubai-linked crude oil versus Brent-linked crude oil.

The Dubai futures intermonth spreads remained mostly unchanged Wednesday morning from Tuesday’s assessments.

The October/November Dubai futures spread was pegged at 73 cents/b, while the November/December Dubai futures spread was pegged at 69 cents/b at 11 am in Singapore (0300 GMT) on Wednesday.

These compared to 70 cents/b and 69 cents/b assessments for the two respective spreads on Tuesday.

Meanwhile, market participants were digesting Abu Dhabi National Oil Company (ADNOC) OSPs for its August-loading crude oil grades, namely Murban, Umm Lulu, Das Blend and Upper Zakum, which it released late Tuesday.

While the OSPs were lower compared to July, the OSP differentials of the four grades to Dubai were raised by between 14 cents/b to 34 cents/b.

Market participants surveyed by Platts earlier this week had expected ADNOC to raise the price differentials of the four grades by 10 to 20 cents/b month on month, in reflection of spot trading levels over August.
Source: Platts

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