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AMERICAS OIL: Brazil’s Medium Sour Diffs to Face Pressure: Kpler

AMERICAS OIL
BulletEnergy BulletsCommodities

Brazil’s medium sour differentials are set to face bearish pressure in the near term, according to Kpler.

  • Mero crude, unlike most other Brazilian grades, saw strong output rises in 2024 with capacity rising to 590k b/d amid the start of a new FSPO. A fourth platform is to be commissioned later this year, boosting output to 770k b/d.
  • Additional Mero crude exported from Brazil will be to the advantage of European refiners – the usual buyers of the grade.
  • Rising export supply will help differentials with a long overdue downward correction, Kpler said.
  • Kpler noted that differentials for Brazil’s main Europe-bound export grade Buzios climbed to around a $3/b premium to Brent in recent weeks, equating to a $2/b rise since in 2025.
  • Some of the downward pressure on export prices due to higher upstream volumes will be offset by a lack of domestic maintenance in March-April and the return to full capacity of some facilities, boosting local demand.

 

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Brazil’s medium sour differentials are set to face bearish pressure in the near term, according to Kpler.

  • Mero crude, unlike most other Brazilian grades, saw strong output rises in 2024 with capacity rising to 590k b/d amid the start of a new FSPO. A fourth platform is to be commissioned later this year, boosting output to 770k b/d.
  • Additional Mero crude exported from Brazil will be to the advantage of European refiners – the usual buyers of the grade.
  • Rising export supply will help differentials with a long overdue downward correction, Kpler said.
  • Kpler noted that differentials for Brazil’s main Europe-bound export grade Buzios climbed to around a $3/b premium to Brent in recent weeks, equating to a $2/b rise since in 2025.
  • Some of the downward pressure on export prices due to higher upstream volumes will be offset by a lack of domestic maintenance in March-April and the return to full capacity of some facilities, boosting local demand.

 

Keep reading...Show less