Strength from the East

Crude time spreads gave a boost to the crude complex, by hiking to 25 cents backwardation at the prompt, while front-month ICE Brent crude reached 76 $/b amid thin liquidity and a growing list of crude production outages in OPEC countries. Interestingly, Dubai crude swaps remained highly bid when ICE Brent markets were close to contango prior to the month. Jan/Feb Dubai swaps rarely traded below 35 cents during December, supported by strong refining runs in Asia. Indeed, Indian and Chinese refining runs remained good while Japanese runs kept expanding to 2.9 mb/d amid good Asian margins lifted by the light part of the barrel. Global onshore inventories continued to be depleted, with Kayrros measurements reporting a 20 mb stock draw globally so far.