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North Sea Trades Bullish But Price Moves Show Fragility

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  • November North Sea crude exports remain relatively steady month on month, at 780,000 b/d, but are 5% below the same month last year
  • Brent future spreads are “on charge” and moving up, but traders question oil's ability to keep the momentum going, even after Opec-plus cuts
  • The North Sea market has moved from backwardation to contango and back on higher demand from refiners coming out of maintenance

The North Sea market has moved from backwardation to contango, and again to backwardation on higher demand from refiners resuming operations after their seasonal turnarounds. But traders question whether the prompt premium over later supplies — a sign of spot oil tightness — can be sustained. Anecdotal evidence from the Brent paper market points to small cracks in an otherwise bullish price structure.

Topics:
Oil Spot Markets, Oil Supply, Oil Trade, Crude Oil
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