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Near Term Brent Spreads Regaining Ground


The Brent crude prompt spread continues to regain ground after falling into contango last week with Sep-Oct up from a low of -0.18$/bbl on 28 June to +0.21$/bbl today.

  • Crude backwardation has strengthened with support from tighter supplies expected for this year after the Saudi Arabia extended production cuts into August and the Russian export cut announced yesterday. Algeria have joined with a small voluntary cut for august to support efforts by Saudi Arabia and Russia to balance and stabilize oil markets.
  • Global economic growth concerns are however still limiting the strength in the spreads. Dec23-Dec24 is holding within the middle of the 1.7$/bbl to 3.9$/bbl range since the start of May and well below a peak of nearly 6$/bbl in mid April.
    • Brent SEP 23 up 1.1% at 75.44$/bbl
    • WTI AUG 23 up 1.1% at 70.57$/bbl
    • WTI-Brent down -0.07$/bbl at -4.77$/bbl
    • Brent SEP 23-OCT 23 up 0.03$/bbl at 0.21$/bbl
    • Brent DEC 23-DEC 24 up 0.09$/bbl at 2.95$/bbl
    • WTI AUG 23-SEP 23 up 0.01$/bbl at -0.11$/bbl
    • WTI DEC 23-DEC 24 up 0.05$/bbl at 3.15$/bbl

Source: Bloomberg

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