Dubai crude 1.3% higher on week but loses ground versus Brent, EFS widens

Quantum Commodity Intelligence - Dubai crude was slightly higher the week ending 23 December, as steady gains over the week lifted the Middle East benchmark to a two-week high ahead of the three-day weekend in Singapore.

Front-month Dubai cash for February delivery was assessed $0.80/b higher on the day at $74.31/b for 24 December (1230 Singapore time) and up $0.98/b compared to the prior Friday, a gain of 1.34%, according to Quantum data.

Growing optimism that major consuming countries will resist nationwide lockdowns to tackle the rapid spread of the Omicron variant helped lift sentiment, but Covid remains the key market driver and concerns linger than harsher restriction could be imposed for the new year.

However, a sluggish December finish to the medium sour spot market saw the structure at the front of the Dubai curve soften over the week, with M1/M3 (Feb22/Apr22) valued at around $1.30/b, down $0.35/b from last week's close.

The one-year structure rebounded, however, with Feb22/Jan23 up $0.50/b on the week at $5.86/b.

ICE Brent futures for February at the 1230 Singapore close Friday were trading at $75.99/b, up $1.57/b on the week as the North Sea benchmark made strong gains versus its Middle East counterpart, underpinned by supply shortfalls from Libya and Nigeria.

The front-line Brent/Dubai cash spread widened to a seven-week high as February hit $1.68/b, up from $1.10/b last Friday, while the February EFS narrowed to around $2.95/b versus $2.73/b on 17 December.

The spot trading cycle has largely concluded for the month and activity is likely to be sluggish prior to the next OPEC+ meeting on January 4.