Benchmark Dubai crude futures’ spreads rose slightly in mid-morning trading hours in Asia on Friday, while Dubai’s discount to ICE Brent futures widened as global crude markets digested news of deeper production cuts by OPEC+ as the group met in Vienna.
The February Brent/Dubai EFS was pegged at $2.83/b at 11 am in Singapore (0300 GMT) Friday, compared with Platts’ $2.74/b assessment at the 0830 GMT Asian close on Thursday.
A wider Brent/Dubai EFS suggests a stronger Brent-linked crude complex compared with Dubai-linked Middle East crudes.
However, Dubai intermonth spreads also rose from Thursday evening to Friday morning in Singapore, suggesting that the Middle East market structure was keeping pace with the strength in global crude markets on the back of the OPEC production cuts.
The January/February spread for Dubai futures widened to be pegged at $1.07/b at 11 am in Singapore on Friday, up from $1.02/b assessed Thursday evening.
The February/March Dubai futures spread also rose Friday morning, pegged at 80 cents/b compared with the assessed 78 cents/b at the Asian close on Thursday.
OPEC on Thursday agreed with Russia and nine other allies on the framework to increase their 1.2 million b/d production cut accord by 500,000 b/d through the first quarter of 2020 to avert a slump in oil prices in the low-demand months ahead.
The proposed deal called on OPEC to take on 395,000 b/d of the new cuts and the non-OPEC allies to shoulder 105,000 b/d, delegates said.
A second major meeting is scheduled on Friday with the non-OPEC partners to discuss the same.
— Eesha Muneeb, email@example.com
— Edited by Norazlina Jumaat, firstname.lastname@example.org