Dubai benchmark slid for a fifth consecutive trading day on Wednesday, as selling frenzy continued for Middle Eastern crude.
Meanwhile, four more deliveries of August-loading crude cargoes emerged, all of which were Upper Zakum crude cargoes.
BRENT-DUBAI EFS IN DISCOUNT
Brent crude futures slipped to a discount to Dubai quotes on Wednesday for the first time since November 2020.
The spread, also known as the EFS, dropped to a discount of 7 cents a barrel for August at Wednesday’s Asia close. The price spread was at a premium of 47 cents at Tuesday’s market close.
The spread had narrowed sharply due to a strong sell-off in Brent amid demand concerns from further U.S. and European Union rate hikes, while the Dubai marker has held relatively strong compared to Brent, despite heavy selling for Middle Eastern crude this month, trade sources said.
SINGAPORE CASH DEALS
Cash Dubai’s premium to swaps slipped 13 cents to $1.36 a barrel on Wednesday.
Four cargoes of August-loading Upper Zakum crude were delivered to Totsa. Unipec sold two of these cargoes, while Vitol and Extap each sold one cargo.
These brought the number of total deliveries for August-loading crude to 64 so far in the month, including 53 Oman cargoes and 11 Upper Zakum cargoes.
NEWS
The monthly price spreads for Brent crude futures are facing significant headwinds from the current higher interest rate environment and recessionary fears, Goldman Sachs analysts said.
Uganda National Oil Co expects to start oil production from the Tilenga project in the first half of 2025, the company’s CEO said on Wednesday.
Russian Urals oil prices for July shipments to India firmed this week due to lower supply and pricier alternatives, but remained below a price cap imposed by western nations, according to three traders familiar with the matter.
Eni has agreed to sell several oil assets in Congo Republic to Anglo-French hydrocarbon group Perenco in a deal worth around $300 million, the Italian company said.
A Russian oil firm is asking Venezuela’s state-run company PDVSA for permission to take control of exports from their joint ventures to revive cash flow from the five companies, which have been hard-hit by U.S. sanctions, two people involved in the talks said.
Source: Reuters (Reporting by Jeslyn Lerh; Editing by Varun H K)