The Brent futures flat price for the prompt contract has seen a major rally this afternoon, strengthening by almost $2/bbl from $77.62/bbl at 13:00 GMT to $79.52/bbl at 16:35 GMT.
Brent approaches the $80/bbl mark once again as continuous attacks from Houthi militants has largely closed traffic through the Red Sea, potentially forcing cargoes around the Cape of Good Hope, an approximate 3,000 nautical mile detour.
Eni’s Sannazzaro de Burgondi refinery in northern Italy is set to return to full capacity after maintenance works which commenced on Nov 07. Turkish companies have reportedly managed to save approximately $2bn through increasing imports of discounted Russian oil and refined products, with shipments of Russian Urals to Turkey reaching an all time high of 400kbbls/d in Nov. Sinochem have capitalised on the easing restrictions for Venezuelan Crude, through purchasing 1mbbls of Merey crude for arrival this month at a discount of $11/bbl to Dated Brent.
As we look ahead to crude inventory data released later tonight (API) and tomorrow afternoon (EIA), analysts are forecasting another draw in stocks.
Spreads remains in contango up until Apr/May with the front and 6-month Brent futures spreads at -$0.10/bbl and $0.16/bbl, respectively.
