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Dated Brent assessed above $90/b for first time since 2014 on tight physical supply

Platts Dated Brent was assessed above $90/b for the first time since 2014, as the global crude market continued to demonstrate tightness for prompt-loading cargoes.

Dated Brent was assessed $1.985/b higher on the day at $90.51/b Jan.19, the highest since a $90.64/b assessment on Oct. 7, 2014.

The increase in Dated Brent’s outright price reflected a confluence of strength across the wider crude market, specific tightness on North Sea physical cargoes, as well as a bullish underlying financial market.

The European and African crude markets have been unusually tight in recent weeks due to various supply disruptions in Nigeria, Libya and Kazakhstan.

After a period of strong buying interest in Platts’ North Sea physical crude cargo Market on Close assessment process, limited physical North Sea cargoes were now left available for February loading but the strength in the prompt paper market had not lost any steam, traders said.

“There has to be some hedging to follow and also some covering for those caught short,” a market participant said.

This sentiment was reflected in sharply stronger Brent Contracts for Differences (CFD) and Dated to Frontline Swaps (DFL) markets in recent days. The February DFL was assessed 36 cents/b higher at plus 43 cents/b Jan. 19.

ICE Brent futures meanwhile settled at $88.44/b Jan. 19, the highest settlement level since Oct. 13, 2014.
Source: Platts

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