CPC Blend crude disruptions propel Dated Brent to three-year high

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An ongoing crude supply crunch in Europe has lifted the Dated Brent differential to an over-three-year high.

Loading disruptions affecting the key feedstock CPC blend crude have rippled through the European market, forcing refiners in the region to seek alternative grades.

The flagship crude out of Kazakhstan has had a few difficult months, from maintenance works to a Ukrainian drone strike in November, as well as bad weather.

That has all come together to cap outflows at the Russian port of Novorossiisk, where CPC Blend loads.

Black Sea crude oil loadings fell by half a million barrels per day following the November drone attack, but they have since recovered slightly.

Still, the loss in volumes has meant that European refiners have had to seek alternative grades from other regions, such as the North Sea to fulfill their light sweet crude oil needs.

This, in turn, has pushed the Dated Beant differential to a near-three-and-a-half-year high.

Some say “what goes up must come down,” and a cautious outlook is emerging for spot prices in February.

CPC Blend differentials have sunk back into discounted territory as sellers struggle to move their cargoes along.

Traders are also then warning that the return of competitively priced Kazakh crude could lead to a swell in available supplies in Europe, thereby dragging on the Dated Brent differential.