Black Sea CPC Blend oil BFO-CPC firmed to 7-year record premium against dated Brent amid a fall in October supply due to maintenance on the giant Kazakh Kashagan oilfield, traders said.

October CPC Blend oil loadings from Russia’s Black Sea port of Yuzhnaya Ozereyevka are expected at some 1.1 million barrels per day (bpd), some 17% down from September exports.

Kazakhstan’s energy ministry said last week that the country’s giant Kashagan oilfield will suspend operations for 38 days to conduct maintenance likely beginning on Oct. 3.

The fall in supply along with good demand for oil in the Mediterranean fuelled demand for CPC Blend, traders said. October cargoes traded at premium of $0.50 per barrel to dated Brent, they said, citing deals for cargoes loading next month. It is the highest premium level since 2017, according to LSEG data. BFO-CPC

CPC Blend oil normally trades at a discount to dated Brent.

October CPC Blend oil cargoes have been mostly sold, according to two of the traders, while the November loading plan was yet to emerge until next month.

“CPC Blend oil firmed so much on a fall of supply, but we don’t think it’ll firm further as we hope for higher November supply,” a source in CPC Blend oil market said.

CPC Blend is a light Caspian grade mostly sourced from Kazakhstan’s oil producers, while a smaller volume is supplied by Russian oil producers. Two of Kazakhstan’s giant oilfields, Kashagan and Tengiz, supply the lion’s share of oil to the CPC Blend flow.
Source: Reuters (Reporting by Reuters; editing by David Evans)