The Dated Brent differential to Forward Dated Brent sank to its lowest level in six weeks on Monday, as Forties retreated amid the restart of production at the key Buzzard field, while Brent Blend declined, lacking support from arbitrage players.
Forties -- the largest producing grade of the four BFOE grades that constitute the Dated Brent assessment -- shed 14 cents/b on a differential basis, slipping to Dated Brent minus 15 cents/b amid selling pressure at the prompt.
Outage at the Buzzard field -- which ended Sunday evening -- had supported the blend, with seven deferrals to the Forties program announced as a result, driving expectations of tighter availability.
With production back online Monday, this pillar of support retreated.
Traders are instead looking to Asian demand for the blend to tighten the market.
"There seems to be regular demand from the East...I expect two VLCCs to go to Korea and one to China," a trader said Tuesday.
Brent Blend fared worse, plummeting to a more than two-month low of Dated Brent minus 35 cents/b.
A deferral of Total equity Brent Blend cargo B1006 out of October has lengthened the November program, which now stands 43,226 b/d longer than that of October.
The grade doesn't benefit from Asian demand due to the smaller size of the program relative to Forties and restrictions at the load port of the blend -- Sullom Voe -- which cannot accept VLCCs.
