The combination of push factors due to a much longer Atlantic Basin crude balance and pull factors due to a much larger shortfall in East of Suez has driven a surge in interregional crude arbitrage (see Asian Oil Monthly – Issue 4)

  • Crude shortfall on the back of OPEC supply cuts has driven a surge in the relative value of Dubai vs. other benchmarks
  • This coincided with a much longer balance West of Suez, allowing Atlantic Basin crude to move eastwards and plug the gap
  • Fixture data illustrates how increased flows have been sourced from a variety of regions, including Latin America, the US, and Europe on top of a West African surge
  • Rising crude demand West of Suez should crimp the push factor from this point and is expected to see a gradual slowdown in arbitrage flows