Brent Prompt Spread Falls into Contango as Futures Extend Decline

The Feb24-Mar24 Brent time spread has fallen further today to join the front WTI spread in contango suggesting ample near term crude supplies as front month futures have dropped to new lows for the day. Stronger than expected non-OPEC supplies have been weighing on prices to offset OPEC production cuts.

• The weakness is also driven by the market uncertainty over future OPEC compliance with voluntary cuts combined with a stronger US dollar today and ongoing global demand growth concerns.
• Brent front month is trading at the lowest since Nov 17 with next technical support at the Nov 16 low and bear trigger of 76.71$/bbl.
• The Brent Jan24-Feb24 spread has fallen from over 0.4$/bbl on Nov 30 back to a low of -0.04$/bbl today. The prompt WTI spread has been trading in contango since Nov 15.
  • Brent FEB 24 down -1.4% at 77.79$/bbl
  • WTI JAN 24 down -1.6% at 72.91$/bbl
  • WTI-Brent down -0.1$/bbl at -4.66$/bbl
  • Brent FEB 24-APR 24 down -0.14$/bbl at -0.03$/bbl
  • Brent JUN 24-DEC 24 down -0.28$/bbl at 1.4$/bbl
  • WTI JAN 24-FEB 24 down -0.05$/bbl at -0.23$/bbl
  • WTI JUN 24-DEC 24 down -0.31$/bbl at 1.57$/bbl