Wider TI/Brent helps USGC arbs to open
- Escalation of violence between US and Iran has markets in rally mode again.
- Yesterday’s North Sea Window saw much stronger values for grades included in the Dated Brent calculation and DFL is shooting higher.
- WTI/Brent spread is widening just as we expected.
- For the first time in about 20 calendar days, we are starting to see WTI workable into NW Europe again.
- CPC and several WAF grades landing cheaper in NW Europe for the same end-of-October timing. More work needs to be done on freight or WTI/Brent before we can call the USGC to NW Europe are open.
- WTI to Far East remains closed. WAF, CPC, and SE Asian grades are a better fit.
- We continue to call for Nov and Dec WTI/Brent spreads to widen to -$9/Bbl.
- We took profits on our long Mars Q4 basis position although there is likely even more upside for this position.
- We are looking for a good entry point (and liquidity) to go long Q1 27 Mars basis.
(WTI/Brent widening to help offset rising freight [TD25])
About the Author
Aaron Kildow | Crude Commodity Owner, Sparta Commodities
Aaron is Sparta’s Commodity Owner for crude, covering physical and financial oil markets, hedging structures, and customised oil balances. He co-founded The Oil Balance and spent over a decade at Macquarie Group building supply/demand models for Cushing, PADD 1, and PADD 3, with earlier trading and derivatives roles at CHS, Musket Corp., and Prudential Financial.
Connect: LinkedIn
About Sparta
Sparta is the AI leader for commodity trading, home to Leonidas AI, the first decision-making engine for oil and commodity traders. Backed by USD 42 million in Series B funding led by One Peak, with participation from returning investors FirstMark and Singular, the same investors behind AI leaders like Legora, Dataiku, and Synthesia. From independents to multinationals, the world’s leading commodity teams use Sparta and Leonidas AI to move faster, trade smarter, and stay ahead of the market.
For more information, visit Sparta or follow us on LinkedIn.
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