North Sea crude loadings set for small increase in November

Quantum Commodity Intelligence - Underlying volumes in the North Sea Dated Brent benchmark are set to increase slightly in November, as output returns to normal levels after the North Sea maintenance and upgrading work is completed for 2022.

Supply from the five grades that underpin Dated Brent – Brent/Ninian, Oseberg, Forties, Ekofisk, and Troll – will average around 780,000 bpd in November versus the scheduled program of 755,000 bpd in October.

Ekofisk, which accounts for the largest volume of the five Brent 'basket grades,' will see output fall by around 10,000 bpd to 260,000 bpd, while the second largest grade by volume, Forties, will fall around 30,000 bpd to 200,000 bpd.

Oseberg is scheduled to drop by around 17,000 bpd to 80,000 bpd, while fellow Norwegian grade Troll is set for an output increase of over 80,000 bpd to around 180,000 bpd, offsetting reductions in the other grades.

Output for the UK Brent/Ninian blend, the original two grades underpinning the Dated benchmark, is set to increase by around 3,000 bpd to 60,000 bpd.

Dated Brent grades have traded at elevated levels during the summer months, underpinned by loading shortfalls and buoyant distillates and gasoline margins, but have since retreated sharply.

The last trade on Forties was heard at Dated Brent swaps minus $0.85/b FOB versus the underlying Dated Brent swap, having traded at more than +$5/b during the summer, with the North Sea grades now facing steeper competition from light sweet crudes from the US Gulf and West Africa.

UK oil and gas output was estimated at 490 million boe in 2021 but only around 40 million boe net were added to reserves as exploration activity slumped as a result of Covid-19, according to a report from the North Sea Transition Authority (NSTA).